I hope you had a delightful Easter weekend!
I have fond Easter egg hunt memories…
They were always at my uncle and aunt’s house up in North Carolina. They had a massive backyard spanning two acres.
They would hide the Easter eggs among the dozens of pine trees in spots that were truly hard to find.
If we were lucky, we could find ten Easter eggs. But we had to work for it, and as the fourth of five kids, it was tough.
The story for my kids, ages 7 to 14, is quite different.
This year, our church dropped 2,000 eggs out of a helicopter (WWJD, right?).
Yes, just dropped them all over the grass. The kids simply walked out and filled up their baskets with ease.
Then we went home, where my wife and her sister planted hundreds of eggs in our backyard. Just laid them in the grass. Again, my kids and their cousins walked out and filled up another basket.
But wait, there’s more…
Then, we went to our local community center, where there was another Easter egg hunt. Again, eggs everywhere.
At least here, they were limited to 20 eggs.
It’s enough candy to last until Halloween.
Of course, there is a challenge.
The challenge is to get the golden eggs. It used to be one, but now there are usually three.
The golden eggs have money in them: $5.
When I think about the future of the stock market … the next 10 years … I believe it will be similar to my kids’ experience this past weekend.
Everyone who shows up, who has a good amount of money stashed away in the stock market … will be rewarded.
Making money will not be hard.
Just put it into a few ETFs and let it grow. It’s as easy as walking out and picking up Easter eggs.
But those who are a bit more strategic will find a few golden eggs and prosper. I’m talking about making gains of 1,000% to 10,000%.
Why?
Because AI is ushering in a new, multi-year bull market. The Dow Jones Industrial Average Index (DJIA) has already surged to 40,000. But it won’t be long before AI ushers in Dow 100,000.
With Dow 40,000 In Sight, 100,000 Is Around the Corner
The AI-driven rally in stocks is just getting started. We’re still in the early stages.
Why do I say that?
Because today’s market for AI feels remarkably similar to the rollout of the personal computer and internet connectivity in the 1990s.
It took over a decade for businesses and consumers to realize how powerful the internet could be and how much it could transform their lives.
But as these communication networks grew, productivity soared.
And we’re talking about productivity across the board here — in everything that every single business does.
For instance, let’s say the engineers at Ford Motors (NYSE: F) are designing a new model for the South American market.
Back in the 1990s, someone would draw up the blueprints at the company’s headquarters in Dearborn, Michigan.
Then, the finished blueprints would have to be physically boxed up and shipped to somewhere like Colombia or Argentina for review.
This process alone used to take days, and cost the company for shipping, customs and more.
All of this before a single vehicle gets manufactured, shipped, sold or driven.
The internet changed all that.
Suddenly, Ford’s engineers could just attach the blueprint document to an email, hit “Send,” and the same job was done in seconds with zero cost. It was nothing less than revolutionary. And it substantially increased productivity.
That’s why the Dow Index, a measure of 30 of America’s top companies, soared so much in the 1990s.
And why it has the potential to soar at least as much now.
The 1990s were the Dow’s best decade of the 20th century. The index gained 317.6%.
So far in the 2020s, the Dow is up 39.2%. It’s just shy of 40,000.
That’s in spite of a massive tumble during the Covid crash, and 2022’s bear market.
But the rise of AI is just getting started. And it will allow companies to achieve more, move more quickly, and do so with fewer resources.
That suggests a productivity boom at least on par with the 1990s bull market. Likely greater.
The Labor Department noted that the 1990s and 2000s saw a significant surge in productivity compared to the 1970s and 1980s.
That was thanks to the rollout of the internet. Since that rollout, productivity has slowed again.
AI Could see productivity jumping back to a 2.5% annual percent increase, if not more.
As Charles Mizrahi pointed out in the March 20 Banyan Edge issue:
“U.S. GDP for 2023 was more than $27 trillion. If AI increases GDP by just 5% … that would come to more than $1 trillion!”
And that increased GDP will compound further over time.
That means markets could be on track for another decade, similar to the 1990s.
And if that happens, we’ll easily clear Dow 100,000 by the end of the decade.
Why?
Because from 40,000, the Dow only needs to soar 150% from here.
That’s easily achievable for the market in the next few years.
We’ll likely see better returns than that. Thanks to AI, there’s no reason why productivity increases couldn’t top 3% annually.
I’m confident in that prediction.
And as it plays out, the top AI stocks will likely soar on par with the top internet stocks of the 1990s…
How the Top Internet Stocks Fared in the 1990s
While the Dow soared over 300% in the 1990s, the biggest gains came from companies that were building the hardware or software that made the internet rollout possible.
In other words, it was the “Picks and Shovels” stocks that dominated the internet’s “gold rush” era.
Microsoft (Nasdaq: MSFT) is likely the best-remembered name from the 1990s internet boom.
Their Windows operating system became the de-facto program for computer users. Microsoft didn’t just create a program and sell it.
They were one of the first tech companies to create hype around the life-changing power of their product.
Plus, products bundled on Windows, like Microsoft Office, which first launched in November 1990, allowed millions to use and share the same file formats – a standard still true today.
During the 1990s, Microsoft shares soared 9,533.2%.
But that’s a fraction of what two other internet boom players managed to achieve…
Qualcomm (Nasdaq: QCOM) managed to soar 17,236.6% after going public in September 1991.
Best known for its work in wireless communication technology, Qualcomm developed software and hardware to support the rollout of another big communications device of the 1990s, the mobile phone.
Qualcomm’s biggest win in the 1990s was the development of CMDA technologies, which allowed multiple access over a single communications channel.
That allowed cell networks to scale. And Qualcomm’s software and patents became a core part of the 2G network.
You may have even had one of their cell phones, such as the QPC-860. You could talk to anyone, anywhere, for just $0.50 per minute.
However, the real winner of the internet rollout is the manufacturer of modems, switches and other communications products at the core of internet hardware.
I’m talking about Cisco Systems (Nasdaq: CSCO). It left Qualcomm and Microsoft in the dust, soaring a phenomenal 69,259.8% in the 1990s.
It started in the early 1990s, developing routers that could bridge the TCP/IP gap. That made it easier for computers not just to connect with other computers but to specific internet webpages.
At its peak, Cisco was valued at over $550 billion — making it the most valuable company in the world. And a $1,000 investment would have turned into nearly $70,000 in a decade.
Here’s how they all stack up:
Talk about golden eggs!
The S&P 500’s return for the decade is just a blip on the radar — despite being an above-average decade for stocks.
Clearly, there’s life-changing money to be made buying into the right player of a new tech trend.
Today’s AI rollout is already sporting some big winners. And like in the 1990s, the companies supplying this trend are making the biggest splash.
It’s clear from the moves in Qualcomm and Cisco that today’s tech winners, chipmakers like Nvidia (Nasdaq: NVDA), have more room to run.
But the biggest profits are still on their way.
So, what are today’s golden eggs for the AI boom?
Here’s how our experts are targeting the best AI plays for 2024 and the years beyond…
The Top Plays for Today’s AI Boom
Just as investors needed just one golden egg from the 1990s internet boom, just one winning AI stock will transform your wealth.
Fortunately, our experts have been researching the most likely prospects for the top winner of the AI boom.
For instance, Adam O’Dell is putting the finishing touches on his research into where the world’s top Tech Titan is investing now.
It’s a tiny company that is at the forefront of a new technology — with the power to disrupt an entire industry.
A company that has over 1,500 patents and applications protecting its technology.
A company that is a leader in the AI market … a market projected to grow from roughly $500 billion to $200 trillion over the next six years.
That’s an increase of 39,900%!
And its Green Zone Power Rating has steadily been increasing over the last four years:
That’s just one potential company that will drive markets higher in the years ahead, taking the Dow to 100,000.
Prepare Your Portfolio Now for Dow 100,000
Frankly, we’re seeing AI roll out faster and more efficiently than the internet. But it’s still in its early stages.
That’s why Dow 100,000 is already in my sights, even if it’s “only” at 40,000 today.
In just the next few years, a significant number of jobs will see substantial enhancement thanks to AI tools.
We’re already seeing AI permeate everything from faster and more efficient drug research to improved crop production with less wasteful fertilizer use on farms.
Just like the internet boom of the 1990s revolutionized communications, today’s AI rollout could lead to another 300% rally for market indices like the Dow.
The big winners in the next few years will be hardware and software players. But over time, just like with the rise of the internet, all will benefit. And that will lead to some massive wins ahead.
Along the way, don’t be surprised if the Dow doesn’t just surge to 100,000 — but rises far past it before this trend starts to slow.
But it’s still important to stay disciplined and look for those “golden egg” investments that will produce the biggest wins.
Our experts at Banyan Hill will continue to invest the time and energy to point you to the best opportunities for those golden eggs … all while making investing safe, easy and fun.
Happy hunting!
CEO, Banyan Hill, Money & Markets