Well, in 10 years the Dow went from 2,000 to 10,000. That's a compound rate of increase of only 17% a year.
To go from Dow 10,000 to Dow 100,000 at a 17% annual rate of increase takes only 15 years.
The power of compounding is utterly incredible.
And in 1999, it seemed reasonable that the stock market would continue to return 17% a year from now until the end of time.
Because obviously Cisco Systems would eventually have a market capitalization greater than global GDP by 2015...
That is how valuable that stock would need to be by 2015 in order to justify its March, 2000 earnings per share ratio.
