The Dow Just Closed Above 36,000—22 Years Later

A scene from the floor of the New York Stock Exchange.

Michael Nagle/Bloomberg

The Dow Jones Industrial Average just ended the day above the 36,000 level for the first time, well after two experts predicted late last century. The rapid recovery from the recession the pandemic brought was the final factor that pushed it over the line.

The Dow rose 0.4% Tuesday to hit a record closing high of 36,052.63, rallying as companies’ third-quarter earnings have impressed investors despite supply- chain problems that have limited sales and profitability.

The 36,000 has been a long time coming. The 1999 book Dow 36,000: The New Strategy for Profiting From the Coming Rise in the Stock Market, published by columnist James K. Gassman and economist Kevin A. Hassett, argued that the Dow was about to go on a run that would take it to that level sometime between 2002 and 2004.

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Hassett was chairman of the council of economic advisers from 2017 to 2019 in the Trump White House. He also served as economic adviser to the 2005 George W. Bush and 2008 John McCain presidential campaigns.

The book’s forecast implied impressive stock returns. Had the Dow reached 36,000 by October 2002, it would have risen at a compounded annual rate of 50% from the book’s publication. If it had reached that level by October 2004, it would have compounded at a 28% annual clip.

Instead, it took 22 years from the time the book was published for the Dow to cross the line. The setbacks are easy to remember. The dotcom bubble broke shortly after the book came out, while the 2008-2009 financial crisis was another enormous disruption.

The actual compound rate of gain for the Dow since the book came out is 5.8%.

The economic recovery from the pandemic, fueled by vaccinations and trillions of dollars of fiscal and monetary stimulus, have driven the Dow to its current level. It is up 88% since March 2020, when it hit its low point in the bear market unleashed as the first U.S. lockdowns went into effect.  

What’s next seems to be up to the Federal Reserve. Policy makers are trying to thread the needle between failing to act to counter inflation, and choking off a slowing economic recovery by tightening monetary policy too fast.

Write to Jacob Sonenshine at