The 1990's yielded unprecedented growth in the stock markets. The NASDAQ grew
at a faster rate than the Dow. The companies making up the NASDAQ averages have
more entrepreneurial content. Great companies, such as Dell Computer, Microsoft,
Intel, etc. developed technological advances that facilitated more practical
advances. This led to unprecedented productivity growth, which is the most basic
underlying principle in economic growth. Manufacturing companies were employing
"lean" practices. The better automobile companies abroad began
expansion in the U.S.
Lean manufacturing and
processing methods were imported from Japan. The great Shigeo Shingo
educated many manufacturers around the world, including the U.S. to
build products faster, while also making them better.
Political advances were made as well. Television developed educational shows,
such as 60 Minutes and Date Line. These shows exposed more and more stupidity of
politicians and other con artists. But that was not enough. Talk radio, such as
Rush Limbaugh and Mark Davis reached many more millions of people every day and
further eroded the "importance" of politicians and other "get up
at noon" folks. Then came the internet, where more competitive
honesty was imposed on conventional media. Without the internet and
other technological advances, Bill Clinton would not be living his life
in continuing embarrassment.
But the biggest event that occurred in the 1990's was the growing number of
free people in the world. The iron curtain's fall was finally kicking in and
businesses around the world flourished. The internet was born and value
producing people around the world could communicate directly with their
counterparts and without having to be processed through political protocol.
The LT Indicant was a little slow in detecting the variable of "world
freedom." It signaled "buy" in November 1991. Also, the incoming
republican house and senate with a democratic president stalemated government
for the first time in over fifty years. This was favorable for capitalism and
the stock market. Un-cooperative branches of government are always favorable for
the stock market.
Imagine the people of China becoming "free." Imagine the
elimination of corruption in all governments around the world, including Mexico,
Russia, India, etc. If all people in the world were free, it would not take much
time for the Dow and NASDAQ to achieve the 100,000 plateau. The LT Indicant
model has been adjusted for this burgeoning variable.
But the political elite will do
things that interrupt this upward flow of prosperity around the world.
They need to continue to delay this process so they and their offspring
will not be subjected to competitive elements. However, in the long-run,
honest, hard-working people will prevail and wealth can be enjoyed by