Learning from history: The Dow Jones Industrial Average passed 1000, 2000 and 3000 [during the 1950s and 1960s]. Every time the market reached a new high, the “ignore-the-egg-on-my-face” pessimists seized whatever the news of the day was to spin yet another story of fear. (I’m not exaggerating about the emphasis that was continually placed on fearful news, and I invite my clients to visit their local libraries’ microfilm sections to review the newspaper stories that so dominated the popular press.) Let’s face it—fear sells!
With the benefit of the 20-20 hindsight that’s available to us now, I think we should consider some of history’s lessons. For starters, as we have seen, there will always be seemingly solid reasons to be fearful, and we can count on the popular press to keep them in front of our noses. Nevertheless, over the long run, economic growth (and, therefore, Dow Jones growth) has persisted, and the reason is precisely that growth is not dependent on the daily news or the fear du jour. The fact is, dear clients, that growth depends on science, technology, new business methods, work skills, and, in one word, productivity. In this regard, the evidence of time—back to the very beginning of human existence—is crystal clear. Neither wars, nor tyrants, nor plagues, nor the rise and fall of nations has stopped the development of human learning and progress. Indeed, if there has been one constant in history, it has been the progress of human development. It’s enough to make one…hopeful!