A potential U.S. attack against Syria and Fed retreat from asset purchases have shaken global stock markets and sent major U.S. market index down 3-5% below their early August highs. But the move hasn’t shaken James Altucher’s long-term confidence in stocks and today stocks are extending recent gains on news that tensions with Syria could be easing.
The author, blogger and managing director of Formula Capital tells The Daily Ticker the Dow is headed toward 20,000 within the next 18 to 24 months.
“The economy is growing...the stock market is at all-time highs [actually near all-time highs]," says Altucher. "There’s no reason to think that suddenly for the first time in history the market will never return. The market will keep on going up with the economy.”
Altucher is not concerned that stocks will crater when the Fed begins to pull back on its billions of dollars of monthly asset purchases. “Every other time the Fed stopped pumping money into the market, like 1997-1999, the market went straight up afterward.”
Nor is he worried about the situation in Syria. “When there’s a war it’s supposed to be bad [for the market], and when China is floundering it’s supposed to be bad…and yet here we are and the market is at [near] all-time highs.”
His advice: “Don’t make your investment decisions on whether there’s going to be a drone attack on Syria. Find companies where there are deals or a lot of innovation, or trading cheap” relative to earnings.
Apple broke $500 a share ahead of Tuesday’s introduction of the latest iPhone 5—dubbed 5C—and a new, potentially cheaper iPhone and closed 1.6% higher on Monday--topping the 1% gain in the S&P 500. .
Apple’s advance and China’s positive exports number propelled stocks higher overall. And this morning the advance continued as U.S. stock futures were buoyed by more good economic news from China and a plan from Russia for Syria to give up control of its chemical weapons.
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