This post first appeared on Right About Money.
The Dow has been setting record highs regularly this autumn. But it remains an awful long way from one million. Then again—maybe not so long after all, Warren Buffett suggests.
With nothing more than historical average annual returns the Dow, which recently crossed 23,000, will hit 1,000,000 in 100 years. That means a child born today has a good shot at seeing that milestone fall. Life expectancy at birth is in the high 80s, but continually expanding. Half of all newborns in industrialized countries will live past 100, scientists believe. The first human that will live to 150 has already been born, actuaries say.
Why does this matter? Buffett is a smart guy. But even he would say that patience played a bigger role than smarts in building his fortune. His ideal holding time for a stock, he has said, is forever. Such is the allure of compound growth.