The Dow Jones Industrial Average is headed higher over the next 10 or 20 years, according to recurring historical patterns. But how is this possible in light of overwhelmingly bearish fundamentals? That's the dilemma facing investors -- and this video provides critical insights.
What we can't ignore about the Dow Jones is the effect of dollar devaluation. Year-to-year inflation is one thing. But over decades, dollar devaluation has had a pronounced effect. One dollar today is the equivalent of only four cents in 1913. With more time, the dollar will become increasingly worth less -- perhaps eventually worthless.
On a mathematical scale, something interesting is happening. As we go down standard currency denominations, we are subject to the law of small numbers. The further down the rabbit hole we go, the more powerful the effect of the law of small numbers.