Connect with us

Business

Dow Could Hit 100,000 By 2030; Adviser Urges Investors To Prepare

Published

on

The Dow Jones Industrial Average could hit 100,000 by 2030, according to financial author and adviser Ric Edelman. Edelman, who believes incredible profits are in the making for those who prepare for new economic realities. If it doesn’t hit 100,00, he said, it will probably hit 150,000.

The blue-chip index currently trades at around 21,000, meaning a surge to 100,000 would mark a roughly 376% increase.

In his book, “The Truth About Your Future: The Money Guide You Need Now, Later and Much Later,” Edelman tries to educate investors on saving for retirement in the age of technology with life expectancies of 110 and 120. People will need to work much longer than they do today because they will live much longer.

Fortunately, technology has reduced the cost of investing, thanks to exchange-traded funds.

Retirement Will No Longer Exist

“We’re not going to have a future the way our parents and grandparents had theirs,” Edelman told interviewer Scott Gamm in “The Street,” a Yahoo interview show.

Retirement now, as a 20th Century innovation is gone. It won’t exist in the 21st Century.

“You need to save in companies that are going to survive and thrive in the 21st Century,” he said.

Gamm asked Edelman how a person who has failed to start saving early can make up for getting a slow start. “It’s never been easier thanks to the Internet, and exchange traded funds and products of that type,” Edelman said. “Investing has gotten cheaper, it’s gotten easier, it’s gotten faster, it’s gotten safer.”

“Exponential technology also brings with it exponential growth… compound interest,” Edelman said.

And when you take advantage of saving not for 20 or 30 years but for 50, 60 years, you’d be amazed how much wealth you can create.

The Growth Of The Gig Economy

Gamm pointed out a person can also create wealth by having a “side hustle” as opposed to a 9-to-5 job. Edelman agreed. “Thanks to the gig economy, the shared economy, you have the ability to make money on a part time basis with very low risk, very low barrier to entry,” he said. “Anybody can do this, and an awful lot of Americans are.”

He said 16% of American workers are strictly working as contractors who work only when they feel like it.

Will The Trump Rally Continue?

Donald Trump

Noting that some people might be afraid to invest in the markets, Gramm asked Edelman what he thinks of the Trump stock rally. “We’re going to see a continuation of this for the next several decades,” Edelman said.

Over the last 50- or 60-year period, the DJIA has increased. “There’s no reason to think that won’t continue, in fact, financial technology makes that easier,” Edelman said. “We’re going to see incredible profits in the United States as well as globally.”

In his first market update to his clients last month, Edelman noted that the DJIA was up 11 percent since the election, and the S&P 500 index was up 9 percent. If this pace continues, he said stock prices will gain 24 percent this year alone.

He acknowledged there is concern that the “Trump Rally” will fizzle, and that it’s simply the “honeymoon period” new presidents typically experience. Trump’s failure to repeal the Obamacare also fuels this concern since Trump promised he would repeal Obamacare.

Should Trump also fail to reform the tax code and rein in the budget, will stock prices fall?

Why Trump Doesn’t Own The Rally

Edelman claims it’s incorrect to believe that the rise in stock prices is only due to Trump. While the election has excited investors since he’s seen as a business-friendly president, that’s not the only reason stock prices are up. Edelman points to the following economic factors fueling rising stock prices:

• U.S. corporate earnings increased 8% in the fourth quarter. Profits from overseas operations, meanwhile, rose 14.5% compared to the same period the prior year. This marks the biggest advance since mid-2010, according to the U.S. Commerce Department.

• Individuals, not just companies, are now making more money. Personal income is up 4.6% compared to the prior year. Salaries and wages are up 5.5%, according to the Bureau of Economic Analysis.

• The overall economy is growing. According to the Bureau of Economic Analysis, gross domestic product increased 2.1% in the fourth quarter.

• Consumer confidence rose in March to its highest level in 16 years, according to The Conference Board.

When people are confident they will continue to make more money, they are willing to spend more, Edelman noted.

Hence, sales of newly-built homes increased 6% in February, marking a 20% gain over February 2016 and the largest increase in five years.

The president cannot claim responsibility for much of the improvement, Edelman noted. But his positive attitude and his statements that please Wall Street contribute to the country’ economic improvement.

Trump wants to:
• reduce corporate and individual tax rates
• reduce regulation
• increase jobs
• bolster U.S. competitiveness in foreign markets
• repatriate billions U.S. corporations have overseas
• spend $1 trillion on infrastructure

Such positions please investors since they support an environment for improved corporate profits which translates into higher stock prices.

What If Stocks Fall?

The question remains: if Trump fails to pass his policies, will stock prices fall?

This is possible, Edelman noted. Hence, he gives the following advice:

He reminds his clients that portfolio diversification is important since it helps manage risks if stock prices fall. His company’s managed asset program is not totally invested in U.S. stocks.

Strategic rebalancing is also important. Most Edelman managed asset portfolios have been rebalanced this year. The company has been a seller, not a buyer, of over-performing funds. This is a way to maintain proper asset allocation.

Third, Edelman reminds clients of a core market truth. A stock price decline is not synonymous with a loss. Investors should consider what happens after a decline. History indicates stock prices move only in two directions: up and down. If prices drop, sit back and wait. Because markets move in cycles, prices eventually rise. It is always important to remember, however, that past performance does not guarantee future results.

Fourth, keep in mind every new president suffers slips in his early days, and Trump is no exception.

President Clinton failed to pass a health care overhaul in his first term. George H.W. Bush sent commodities prices into a spiral by saying he hates broccoli. The stock market survived such “crises.”

Fifth, keep in mind the stock market has increased dramatically in the last six months. Even if the Dow fell 10 percent, it would still be ahead of where it was on Election Day.

Consider All Aspects Of Financial Security

Lastly, consider that a person’s financial security will not be determined primarily by any president or Congress. A person determines their own future.

Every individual must focus on the aspects of their personal finances that they can control. This includes making sure wills and trusts are up to date, that too much in interest isn’t being paid on the mortgage, that one has the right kind and amount of insurance, the right amount of cash reserves on hand, and proper contributions are being made to retirement plans.

Edelman is chairman and CEO of Edelman Financial Services LLC. He has a radio show, six books, a column, conferences and nearly half a dozen appearances on Oprah. His books include “The Truth About Money; Ordinary People, Extraordinary Wealth” and “The Lies About Money.”

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

3.9 stars on average, based on 8 rated postsLester Coleman is a veteran business journalist based in the United States. He has covered the payments industry for several years and is available for writing assignments.




Feedback or Requests?

4 Comments

4 Comments

  1. corporate_citizen

    May 13, 2017 at 7:02 pm

    We’ve all heard this bull(ish) talk before, just before the dot.com crash:

    https://en.wikipedia.org/wiki/Dow_36,000

    Bottom-line, the stock market cannot rise without liquidity; the hyper-liquidity dumped by central banks for decades, now. Having said that, there is a possibility that the US equity market will rocket upwards due to flight capital if foreign markets flounder. With interest rates at 5,000 year lows, sovereign debt may likely be the catalyst.

  2. thoth

    May 14, 2017 at 7:59 am

    Does the Fed have enough money to buy all those stocks?

    Oh yeah…… Wonder whats it’s balance sheet will look like in 2030

  3. kochelli

    May 15, 2017 at 6:12 pm

    This doesn’t make sense. Probably a typo…

    If it doesn’t hit 100,00, he said, it will probably hit 150,000.

    • Edward Talliot

      May 15, 2017 at 6:42 pm

      Yes, most likely..

You must be logged in to post a comment Login

Leave a Reply

Business

IBM Goes All In On Stablecoin Project as Mainstream Crypto Adoption Grows

Published

on

Dow blue-chip IBM (IBM) has teamed up with a financial technology startup to launch a new stablecoin that will be pegged to the U.S. dollar. The announcement is the latest in a series of positive developments linking mainstream business to the bustling world of cryptocurrency.

IBM Backs Stablecoin

IBM and fin-tech startup Stronghold are developing a new stablecoin by the name of “Stronghold USD,” which is backed by Federal Deposit Insurance Corporation (FDIC)-insured U.S. dollars. Reserves will be held in Prime Trust, a blockchain-focused asset manager.

By experimenting with virtual dollars, IBM is looking to develop new ways of helping financial institutions process payments more quickly and securely. The company is leveraging its existing relationship with Stellar to launch the new stablecoin. This means Stronghold USD will be backed by the Stellar blockchain.

This isn’t the first time IBM has tapped the Stellar protocol to experiment with cryptocurrency. Earlier this year, the technology giant joined hands with environmental startup Veridium to transform carbon credits into digital tokens. As Hacked reported in May, the carbon credits will be used by businesses to offset environmental damage.

IBM’s original partnership with Stellar involved work on a global payment network powered by blockchain solutions. Through Stellar’s digital ledger, IBM is seeking to develop 12 currency corridors in the South Pacific.

Stablecoins: Opportunity and Controversy

In principle, a stablecoin removes much of the volatility from digital currency trading by ensuring that each token is tied to a government-backed currency. Conceivably, each Stronghold USD token will be pegged to the U.S. dollar.

The problem with stablecoins is confirming whether the token is actually backed by an equal quantity of government-backed currency. Much of the controversy surrounding stablecoins emanates from Tether, a highly controversial project that has repeatedly failed to provide evidence of its U.S. dollar reserves.

Tether has also been accused of inflating the price of bitcoin by flooding the market with USDT tokens. Tether is run by the same CEO as Bitfinex, a leading digital currency exchange, prompting an investigation of both companies by U.S. federal regulators. This culminated in a subpoena by the U.S. Commodity Futures Trading Commission (CFTC) on Dec. 6.

Nevertheless, stablecoins have surged in popularity as investors search for a reliable funding mechanism to enter trades. Tether’s USDT token accounts for nearly one-fifth of total cryptocurrency trades, according to data provider CoinMarketCap.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 498 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




Feedback or Requests?

Continue Reading

Business

EOS Developer Secures New Funding from Bitmain, PayPal Co-Founder in Major Investment Deals

Published

on

Despite its recent struggles, the development firm behind EOS has received new backing from several big-name investors, including Bitman and PayPal co-founder Peter Thiel. The deals solidify EOS’ emergence as a major player in the booming market for decentralized applications.

EOS Backing

Bitmain, the world’s largest blockchain company, announced its investment stake in EOS on Monday after CEO Jihan Wu praised the protocol’s performance and scalability potential.

“The EOSIO protocol is a great example of blockchain innovation. Its performance and scalability can meet the needs of demanding consumer applications and will pave the way for mainstream blockchain adoption,” Wu said.

While the specifics of the deal were not disclosed, Bitmain’s involvement is said to align with Block.one’s vision of creating a more “connected world,” according to CEO Brendan Blumer.

Bitmain has quickly evolved into an international conglomerate with a number of key investments in recent months. The company, which was originally a bitcoin mining manufacturer, announced in May it had led a $110 million Series E round for Circle, a cryptocurrency exchange and wallet platform that is also backed by Goldman Sachs.

Earlier this month, Bitmain announced plans to purchase a roughly 43% stake in Opera Ltd., a Norwegian internet browser that has filed for an initial public offering with Nasdaq.

As Hacked reported earlier this month, Bitmain has emerged as the world’s largest blockchain company with a total value of about $12 billion.

EOS in the Spotlight

In addition to Bitmain, the development arm behind EOS has announced that Peter Thiel and hedge fund billionaires Louis Bacon and Alan Howard have also invested in the company. While their monetary contributions have not been publicized, their backing is considered a silver lining for EOS, which has struggled in the wake of a botched mainnet launch that has revealed more weakness than strength.

False starts, account suspensions and, more recently, RAM hoarding have all tainted EOS’ mainnet campaign. The project’s arbitration mechanism has also come under attack, which has compelled founder Dan Larimer to propose a new constitution entirely.

“I am merely saying that the current constitution is not wise,” Larimer said last month. “I have learned a lot about human nature by watching the disputes, the witch hunts, the ‘bring everything before ECAF’ mindset.”

Since peaking in late April, EOS has lost more than two-thirds of its value. The cryptocurrency is back below $8.00 a unit on Tuesday after reaching a high of $8.11 earlier in the week.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 498 rated postsSam Bourgi is Chief Editor to Hacked.com, where he specializes in cryptocurrency, economics and the broader financial markets. Sam has nearly eight years of progressive experience as an analyst, writer and financial market commentator where he has contributed to the world's foremost newscasts.




Feedback or Requests?

Continue Reading

Business

What is UTRUST?

Published

on

There are now so many alt-coins out there that it’s almost impossible to keep track of which projects are legitimate and which are garbage.

This article is the third entry in a series I will write for Hacked which will give summaries and context around a specific crypto project.

The topic of today’s summary is Utrust.

So what is Utrust?

Utrust is basically trying to be the Paypal of the post-blockchain world.

They see two problems with the status quo of escrow solutions.

We can break these into two separate categories.

1. Centralized escrow solutions (Paypal, Venmo etc.)
2. Decentralized escrow solutions (Smart contracts, etc.)

The decentralized and somewhat nature of cryptocurrencies makes them a prime target for scammers who often can simply take funds and then disappear without delivering the promised good or service. More elaborate schemes like the so-called “Man-in-the-Middle” attack one are also a concern.

Another major security risk can also occur when a supposedly trustworthy third-party arbiter simply steals the funds they are ostensibly safeguarding and disappears. Many fake ICO’s did this exact thing. This fraudulent behavior is commonly referred to as an “exit scam.”

While there are escrow services one can use, these are often unreliable and expensive, complicating what should otherwise be a simple transaction process.

The lack of reliable and streamlined solutions to this problem has become a huge issue for the overall mass adoption of cryptocurrency to overcome. If this is then combined with the fact that cryptocurrencies already have a low entry barrier (where anyone can buy small or large amounts), then the overall crypto market transforms into a highly speculative space, with more investors than actual users of the platforms that tokens are supposed to be used on.

Utrust attempts to solve this by leveraging key points from traditional payment processors as well as the advances of blockchain technology.

Utrust works by allowing the user to purchase goods or services with their cryptocurrency or token of choice. The merchant on the other hand automatically receives their payment in fiat currency.

This, in theory, creates an ecosystem where users are not forced to exchange their coins and sellers are not forced to deal with the inherent volatility of cryptocurrency.

Essentially, Utrust is trying to force adoption of cryptocurrency as quickly as possible. Besides the simple interoperability of cryptocurrencies and their consumer-protection system, Utrust also differentiates itself by offering a competitive fee model.

In this model, a 1% fee is charged on purchases, which outcompetes PayPal’s 2.9% + $0.30 USD flat fee. This also has the benefit of allowing smaller transactions to take place in the platform.

One particular focus of Utrust that distinguishes them from their competitors is its consumer protection program.

Utrust employs a (controversially) centralized escrow system to ensure that the funds are kept safe until the buyer receives his/her product or service. Once the transaction is complete, the funds will be sent.

In the event of a dispute, the Utrust dispute resolution team mediates between the two parties to solve the dispute. This automated system allows users to enjoy the benefits of crypto without worrying about additional escrows or multi-sigs.

While this is arguably far more convenient for both buyers and sellers then escrow solutions with more steps to traverse, it should be noted that the very parts of security that are “annoying” are what make it secure in the first place.

The Utrust platform also features its own ERC20 token. It is reasonable to question why this platform needs a token at all, given that the model above even seems complete without it. This is a good question to ask, but Utrust thankfully provides a reasonable answer.

According to the official whitepaper:

“We decided to go a step beyond, and wanted to offer the chance for anyone in the world to become a backer, leveraging the power of an Initial Coin Offering (ICO)….In essence, the UTRUST token will act as an investment stake from our backers, as a transactional token, that buyers can use in the UTRUST Platform itself alongside other major coins, and as a financial mechanism linking the Utrust token value to the Utrust Platform value – our strategic value-coupling mechanism.”

According to the project, the advantages of holding the UTK token are simple:

1. No fees charged when using the UTK token.
2. Part of the profits generated by the 1% fee will be used to buy-back and burn the UTK token, reducing its total supply over time. With a finite and ever-shrinking supply, the token should appreciate in value if the platform is successful.
3. The token can be bought/sold from many exchanges at its market price.

To summarize, In the view of this analyst, Utrust solves the issue of convenience when it comes to the everyday use of cryptocurrency. That is a major accomplishment and should be lauded. But this convenience comes at a price.

I have yet to see a method of security that is both the safest and the most convenient. Until one arrives, Utrust seems to offer a viable solution for the present and the future.

Featured image courtesy of Shutterstock. 

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

Rate this post:

Important for improving the service. Please add a comment in the comment field below explaining what you rated and why you gave it that rate. Failed Trade Recommendations should not be rated as that is considered a failure either way.
0 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 50 votes, average: 0.00 out of 5 (0 votes, average: 0.00 out of 5)
You need to be a registered member to rate this.
Loading...

4.6 stars on average, based on 10 rated posts




Feedback or Requests?

Continue Reading

5 of 15 Seats Available

Learn more here.

Recent Comments

Recent Posts

A part of CCN

Hacked.com is Neutral and Unbiased

Hacked.com and its team members have pledged to reject any form of advertisement or sponsorships from 3rd parties. We will always be neutral and we strive towards a fully unbiased view on all topics. Whenever an author has a conflicting interest, that should be clearly stated in the post itself with a disclaimer. If you suspect that one of our team members are biased, please notify me immediately at jonas.borchgrevink(at)hacked.com.

Trending