Dow 100,000: Fact or Fiction (Hardcover)

by Charles W. Kadlec (Author)

Editorial Reviews

Amazon.com Review
Any number of magazine articles, and even a few books, will tell you that the U.S. stock market in the late 1990s was a dangerous bubble. No one could say when the crash was coming, but a lot of people believed it was just around the next big economic curve. Kadlec, chief investment strategist for Seligman Advisors Inc., has a different point of view: sure, bad things will happen now and then, but ultimately the Dow Jones Industrial Average will end up at 100,000 in the year 2020. In other words, "two decades of above-average economic growth with price stability." This, he notes, represents only an 11.1 percent annual increase in the stocks' value, which, he believes, is entirely realistic.

So how does Kadlec actually get to 100,000? First, he shoots down comparisons to previous periods of boom and bust. The cold war is over, he notes, which represents a new political paradigm. Then there's the oft-discussed drive of the baby boomers to retire in style. And, of course, there's technology, presenting new ways for workers to be more productive and resourceful. Kadlec also sees the worldwide trend toward freedom and democracy as a powerful economic force, as is the need for governments to compete with each other for economic activity. But he cautions that the prosperity he predicts isn't guaranteed: wars (either with bombs or tariffs) could end it pretty quickly. So could terrorism or higher taxes. (He includes some nifty illustrations showing how tax increases on rich people inevitably sock middle-income and poor people harder.) And a currency shock could cause untold economic mayhem. Kadlec notes that even he was surprised by his conclusion that the Dow should travel to this nosebleed height. But if he's right--well, let's just say a lot of investors are going to have very comfortable retirements. --Lou Schuler

From Kirkus Reviews
A positive scenario for the future of the stock market. While many economic forecasters fret over the inflated value of stocks, at least one believes that the market still has a long way to grow. Kadlec, a professional investment strategist, creates a strong and positive argument for further advancement over the next several decades in most areas of business, a period he refers to as ``The Great Prosperity.'' This argument is infectious and upbeat, but the author's intent is more than cheerleading. He bases his work on a sober analysis of history, economic systems past and present, and current trends in politics and business, both local and global. Discussion is based on probability, not certainty, and he emphasizes various dangers and pitfalls that can endanger further growth, even though the overall message clearly weighs heavier on the side of prosperity than collapse. The message is informative and provides a clear set of lessons on the basic underpinnings of economic systems as they function today. For those inclined to accept the author's premise, there are also simple guidelines for investors that are aimed at maximizing the effects of this future expansion. And other guidelines are designed to help all observers participate in a predictive exercise: lists of positive and negative signs that are strong indicators of continuing expansion or presages of economic downturns. Lower tax rates and an increasing number of countries committed to stable exchange rates, for example, are positives, while solving the Medicare funding dilemma and imposing tariffs on foreign trade are on the short list for causing problems. One minor negative: some of the investment strategies and tools included here come from the author's company and are a bit too promotional for an otherwise objective work. The author states that this is not ``a prophecy of the future,'' but it is also more than mere speculation. Definitely worth investigating, if only for the economic education. -- Copyright ©1999, Kirkus Associates, LP. All rights reserved.

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Product Details

• Hardcover: 288 pages
• Publisher: Prentice Hall Press (September 30, 1999)
• Language: English
• ISBN-10: 0735201374
• ISBN-13: 978-0735201378
• Product Dimensions: 9.3 x 6.3 x 1.3 inches
• Shipping Weight: 1.5 pounds
• Average Customer Review: 3.4 out of 5 stars See all reviews (22 customer reviews)
• Amazon.com Sales Rank: #650,731 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

24 of 25 people found the following review helpful:

5.0 out of 5 stars Useful applications for all investors -- new or experienced., November 7, 1999

By A Customer

I highly recommend Dow 100,000 Fact or Fiction by Charles W. Kadlec. This well-researched work clearly and concisley maps out a blueprint for a period of unprecedented economic prosperity.

In a nutshell, Kadlec points to numerous wealth-creating domestic and global trends which should continue to strengthen during the next century. These demographic, economic, and political forces are explained in a common sense approach that both the novice and seasoned investor could appreciate and, more importantly, apply to their investment decisions. While the title surely provides ammunition for the bears among us, Kadlec deflects the ammunition by not taking a pollyanna approach. The risks to achieving prosperity are clearly defined and explained.

Finally, Kadlec includes practical strategies for creating and maintaining wealth during this unique period. Kadlec's vision of the future is predicated on the escalation of individual freedom and choice. Reading this book will provide excellent preparation in order to take advantage of this exciting new era.

19 of 23 people found the following review helpful:

5.0 out of 5 stars A clear roadmap of the 21 year journey to Dow 100,000., October 6, 1999

By A Customer

Charles W. Kadlec's "Dow 100,000 Fact or Fiction" is must reading for any serious investor today. I have read many "how to" books over my thirty-eight years of investing, but none painted such a clear picture of the economic circumstances which surround our investment decisions. Kadlec's book is the AAA guide to investing. It gives you not only a clear road map to your financial destination, but it also points out what detours and speed traps may appear along the way. Kadlec is an economist and Chief Investment Strategist of Seligman Advisors, Inc., yet he writes this book in simple language that every investor will find easy to follow, regardless of age or experience. His discussions of our economic history give real meaning to the events of our more recent past and the challenges of the present. For example, Kadlec's references to the Smoot-Hawley tariffs, which led to the stock market crash of 1929 and the Great Depression, provide a clear understanding of our trade relationships today and how important they are to achieving "The Great Prosperity" which is the theme of his book. This book is more than an economic treatise; it is also a political study, since politics and economics are inevitably entwined. Not only will the reader learn how to invest, but, by implication, how to cast his or her ballot to insure "The Great Prosperity." In today's world of day trading, undue emphasis on quarterly earnings, and the resultant high volatility of stock prices, Dow 100,000 Fact or Fiction provides a clear picture of the long term direction of the world economy and where the Dow should logically be in the year 2020. Is it a certainty? No, and Kadlec points out the potential problems as well. But no investor with a long term financial plan should attempt to navigate through it without this book.

15 of 18 people found the following review helpful:

5.0 out of 5 stars Good times could become the norm. This book tells how., September 20, 1999

By A Customer

Dow 100,000: Fact or Fiction is clear and simple, but never simplistic. Unlike many books on this topic, Kadlec offers thoughtful analysis, not opinion or hyperbole. This is a work grounded in a careful look at history and an understanding of the demographic, social, economic and political forces that alter policy and affect prosperity and stock market returns.

Kadlec begins with the insight that there almost no average years, but that the S&P 500's long run average return of 11.5 % is a homogenization of good times and bad times. He then goes on to answer the question of what determines whether we experience good times or bad times. The 30s and 70s, for example, reflect an accumulation of bad policies and the destruction of financial wealth and prosperity. The 80s and 90s are a period of excellent policies.

Kadlec is not a full-time permanent optimist. He has identified five forces that, if they continue to result in good policies, will propel us to a Dow 100,000. Importantly, however, he has also identified six pitfalls, areas from which policy errors could be made. If these errors occur, not only would prosperity not expand, we could in fact lose it altogether. As a professional money manager, I look forward to hearing more from him.