Dow Will Hit 60,000 in 20 Years, Ron Baron Says
By: Lori Ann LaRocco | CNBC Senior Talent Producer 
Chip East | Bloomberg | Getty Images
Ron Baron
On June 20, a day when investors were heading for the hills and the market was down sharply, Ron Baron's Baron Capital saw its strongest inflows of the year.
The markets plunged that day after Federal Reserve Chairman Ben Bernanke indicated the central bank was getting ready to exit its extreme monetary easing program.
When asked about the recent equity market sell-off that accompanied Fed fears, the renowned buy-and-hold investor stressed buying and selling on news is not a good strategy.
(Read More: One Eye on Earnings, the Other on Bonds)
"Money is running from bonds and gold. I think people investing in bonds can have significant capital depreciation over the next several years," he said in an interview.
The markets plunged that day after Federal Reserve Chairman Ben Bernanke indicated the central bank was getting ready to exit its extreme monetary easing program.
When asked about the recent equity market sell-off that accompanied Fed fears, the renowned buy-and-hold investor stressed buying and selling on news is not a good strategy.
(Read More: One Eye on Earnings, the Other on Bonds)
"Money is running from bonds and gold. I think people investing in bonds can have significant capital depreciation over the next several years," he said in an interview.
Baron's Long-Term Theme Picks
Ron Baron, Baron Capital chairman & CEO, shares where he is his seeing long-term investment opportunities in technology and brick &mortar plays.
"Everyone thinks they are advantaged by trading on news. They are not. This is why the average investor in mutual funds makes 3 percent per year while the average mutual fund earns 7 percent per year." Baron added.
"Investors who base their buy and sell decisions on current news generally sell and buy at exactly the wrong times. It's crazy," he continued.
(Read More: Get Ready for Earnings—It's Prove-It Time)
The biggest market mover this summer has been worries the Fed will pull back on its $85 billion a month bond-buying as part of quantitative easing.
"Investors are selling aggressively reacting to news the Fed's announcement that they might slow their open market bond purchases because the economy is steadily improving."
The economic recovery, he said, is the reason why now is a "great time to buy."
(Read More: Job Growth Posts Large Gain in June; Rate Holds)
"Companies have almost doubled their earnings in the past 13 years while stock prices have increased only about 25 percent," he said.
Expecting stock market returns for the next 20 years to approximate the 7 percent annual returns earned by U.S. stocks for generations, Baron quoted Albert Einstein that "the most powerful force in the universe is compound interest."
He said in his opinion based on the compounding effect, "the Dow Jones will be 30,000 in 10 years, 60,000 in 20 years."
Baron is putting his money behind his words.
Some stocks Baron Capital has recently purchased include Concho Resources, Edwards Lifesciences, Hyatt, Caesarstone, Manchester United, Dick's Sporting Goods and Under Armour.
Emphasizing these purchases are not for the short-term, Baron stressed the average length of time his firm holds their stocks is seven years.
"This is the beginning, not the end for stocks." said Baron. "You should not be afraid to invest now."
_By CNBC's Lori Ann LaRocco. Follow her on Twitter
ONLY IDIOTS,MORONS LISTEN TO CURRENT NEWS AND THEIR FUCKING GRANDMOTHER STORIES.TODAY STCKMARKET UP,DATA BAD-NEWS WILL SAY "DIMINISHED HOPES OF FED TAPERING BOOST STOCKS"
THE VERY NEXT DAY,STOCKS SURGE AGAIN ON VERY GOOD DATA,ABOVE EXPECTATIONS-THEN YOU WILL SEE A BUNCH OF SPIN TALL TALES SHITS SAYING"MAYBE THE INVESTORS SHRUG OFF FED TAPERING FEARS AND THE ECONOMY IS REALLY VERY STRONG TO STAND ON ITS OWN FEET"
INVESTORS SUDDENLY HAVE DUAL PERSONALITY,SUDDENLY SO AFRAID OF FED TAPERING,SUDDENLY SO NONCHALANT ABOUT FED TAPERING.
I,AS USUAL,SAY "FUCK YOU,NEWS".MY BLOG HAS ABSOLUTELY ZERO NEWS OF FED TAPERING SHIT,EGYPT POLITICAL TURMOIL SHIT,CHINA SHIT SHIBOR FEARS,PORTUGAL POLITICAL TURMOIL SHIT,ETC.THE DAY I POST CURRENT NEWS IN MY BLOG IS THE DAY I GO TO INSTITUTE OF MENTAL HEALTH FOR TREATMENT OF "SPLIT PERSONALITY" OR "DUAL PERSONALITY".
I BET WITH YOU.ANYBODY WHO OBEY CURRENT NEWS 100% CANNOT EVEN SURVIVE BEING A FULLTIME INVESTOR EVEN FOR 1YEAR
.
"Investors who base their buy and sell decisions on current news generally sell and buy at exactly the wrong times. It's crazy," he continued.
(Read More: Get Ready for Earnings—It's Prove-It Time)
The biggest market mover this summer has been worries the Fed will pull back on its $85 billion a month bond-buying as part of quantitative easing.
"Investors are selling aggressively reacting to news the Fed's announcement that they might slow their open market bond purchases because the economy is steadily improving."
The economic recovery, he said, is the reason why now is a "great time to buy."
(Read More: Job Growth Posts Large Gain in June; Rate Holds)
"Companies have almost doubled their earnings in the past 13 years while stock prices have increased only about 25 percent," he said.
Expecting stock market returns for the next 20 years to approximate the 7 percent annual returns earned by U.S. stocks for generations, Baron quoted Albert Einstein that "the most powerful force in the universe is compound interest."
He said in his opinion based on the compounding effect, "the Dow Jones will be 30,000 in 10 years, 60,000 in 20 years."
Baron is putting his money behind his words.
Some stocks Baron Capital has recently purchased include Concho Resources, Edwards Lifesciences, Hyatt, Caesarstone, Manchester United, Dick's Sporting Goods and Under Armour.
Emphasizing these purchases are not for the short-term, Baron stressed the average length of time his firm holds their stocks is seven years.
"This is the beginning, not the end for stocks." said Baron. "You should not be afraid to invest now."
_By CNBC's Lori Ann LaRocco. Follow her on Twitter
@loriannlarocco
ONLY IDIOTS,MORONS LISTEN TO CURRENT NEWS AND THEIR FUCKING GRANDMOTHER STORIES.TODAY STCKMARKET UP,DATA BAD-NEWS WILL SAY "DIMINISHED HOPES OF FED TAPERING BOOST STOCKS"
THE VERY NEXT DAY,STOCKS SURGE AGAIN ON VERY GOOD DATA,ABOVE EXPECTATIONS-THEN YOU WILL SEE A BUNCH OF SPIN TALL TALES SHITS SAYING"MAYBE THE INVESTORS SHRUG OFF FED TAPERING FEARS AND THE ECONOMY IS REALLY VERY STRONG TO STAND ON ITS OWN FEET"
INVESTORS SUDDENLY HAVE DUAL PERSONALITY,SUDDENLY SO AFRAID OF FED TAPERING,SUDDENLY SO NONCHALANT ABOUT FED TAPERING.
I,AS USUAL,SAY "FUCK YOU,NEWS".MY BLOG HAS ABSOLUTELY ZERO NEWS OF FED TAPERING SHIT,EGYPT POLITICAL TURMOIL SHIT,CHINA SHIT SHIBOR FEARS,PORTUGAL POLITICAL TURMOIL SHIT,ETC.THE DAY I POST CURRENT NEWS IN MY BLOG IS THE DAY I GO TO INSTITUTE OF MENTAL HEALTH FOR TREATMENT OF "SPLIT PERSONALITY" OR "DUAL PERSONALITY".
I BET WITH YOU.ANYBODY WHO OBEY CURRENT NEWS 100% CANNOT EVEN SURVIVE BEING A FULLTIME INVESTOR EVEN FOR 1YEAR
.
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