I hear many smart investors talking about how we are going to see another stock market selloff. They point to the weak GDP, job losses, and many other important data points. I am here to say that I actually think that the Dow Industrial Average will blow through 30,000 this year and go even higher. Why?

Because fantasy and excitement don’t have any limits. Business fundamentals, on the other hand, have limits. Look at Tesla. The car market has a market cap of $145 billion. You have to put several traditional car makers together to come up with $145 billion. Tesla is valued based on whatever earnings per share you can dream up and multiply them by 20, and boom, you have your stock price. If the current stock price is lower than what you dreamed up, then take another nap and dream up something better.

The same thing goes with Carnival Corp (CCL) or American Airlines (AAL) or any other indebted and unprofitable businesses. The logic should tell you that older people, main cruise line customers, are unlikely to return to taking cruises in large numbers. They might completely change their vacation destinations to places where they are not stuck with thousands of people in a container.

As far as airlines like American Airline (AAL), I don’t see how everybody will start flying the same way they did before the Coronavirus. Personal and business travel might be down for some time because of fear of catching the virus. Also, many businesses learned how to use Zoom.

I could go on and on with how the world will be different after we come out of the lockdown. We could talk about how indebted companies won’t be able to service their debts. We could talk about how restaurants will need to have fewer seats inside. We could talk about how all of this will translate into slower revenue and earnings growth. Why do that? That’s not fun.

I think what is going to happen is that after the quarantines end fully or partially, people are going to buy stocks like there is no tomorrow. There will be panic buying causing the Dow Industrial Average to blow through 30,000. This might happen before the elections. I fully understand that this should not happen, but there is a difference between what should happen and what will happen. This is just my two cents.

When I wrote my book, How to Profit from the Coronavirus Recession – 50 Actionable Investment Ideas, in early April, I might have gotten the timing of a bottom to an absolute perfection.  At that time, I did not think that the Dow would have a chance of going to all time high anytime soon. But now I am realizing that fantasy is much more powerful than reality.