Not so fast

Putting the Dow Into Perspective

By Allan Sloan
Tuesday, October 10, 2006; D02

Have you recovered yet from celebrating the Dow's record highs last week? Hope you didn't go too wild. Hangovers can be so nasty -- though it sure was fun watching folks on the New York Stock Exchange floor whoop it up as the Dow finally eclipsed its highs set in early 2000.

But in my customary role as party pooper, I'll let you in on a little secret: Even though the Dow has broken the high it set on Jan. 14, 2000, the market is nowhere near its all-time high. That's because the 30-stock Dow Jones industrial average isn't the same thing as the U.S. stock market. Not even close.

Although the Dow notched three straight records last week and ended yesterday close to 12,000, the real market indicators are still way below their highs. One of them, the Standard & Poor's 500-stock index -- which includes 470 more stocks than the Dow does -- ended the week 12 percent below its peak, reached on March 24, 2000. The Dow Jones Wilshire 5000, which includes all U.S. stocks and peaked the same day as the S&P, was down 8 percent.

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