ICYMI – Wharton’s Jeremy Siegel says the Dow could surpass 40,000

<p>Wharton finance professor Jeremy Siegel likes the DOW index higher, favouring the big round number just above us at 40,000:</p><ul><li>“We could definitely get it past 40,000”</li><li>

"A 10% to 12% rise in stock prices is not out of the question for 2024”</li></ul><p>The risk is the Fed:</p><ul><li>“If the Fed is stubborn and says, ‘I’m just going against inflation, even if the data gets soft,’ those figures would have to be adjusted downward…if the Fed keeps money [supply] stagnant, as it has been, you are looking at a recession right in the face. That is why the Fed must ease."</li></ul><p>Siegel says the economy is slowing, and the Fed must recognise that "all its tightness is in the pipeline and will press on the economy in 2024, so they have to start thinking about lowering rates". Siegel tips a March rate cut from the FOMC.</p><ul><li>“Even if they don’t lower interest rates in January, they may have to lower it in the March meeting.”</li></ul><p>He says inflation is beaten, but:</p><ul><li>“There will be core elements in the CPI that will continue to rise, and institutionally determined prices that take months to come down, but to eliminate those remaining price increases would mean crushing the economy—and that would be inadvisable from an economic standpoint" </li></ul>

This article was written by Eamonn Sheridan at www.forexlive.com.