Ron Baron, the founder of Baron Capital Group, is bullish on the world economy. In a CNBC interview earlier today, the fund manager predicted that the DOW Industrial average (INDEXDJX:.DJI) could hit 28,000 in ten years, and could hit 60,000 in 20 years. The incredibly bullish comments mirror those being made by Baron in recent conferences and interviews.

ron baron

Baron believes that, including inflation, the economy is due to grow by about 7% per year for an extended period of time. The DOW Industrial index (INDEXDJX:.DJI), which hit its highest closing level of all time lat week, will mirror that growth according to Baron. That implies a doubling of the index every ten years, and at today’s level of around 14,000 that means 28,000 by 2023.

Long term economics predictions are difficult to master, though they may be more accurate than short term predictions in many ways. Baron uses the strengths of long term prediction models, which normally conform to patterns much more easily than short term predictions. According to his analysis, the economy has averaged a growth of 7% per year over the long term.

He says that the 7% growth extends as far back as 200 years, and sees the economy’s current difficulties as a blip in the model, rather than a structural change in the economy. If he’s right, there’s very little to worry about going forward, but even if the current malaise does not represent a structural change, there may be one to come in the future.

What is unusual about the bullishness of the comments, is that they come in a time of severe economic uncertainty. Usually when analysts make comments about how unstoppable economic growth is, or how recession have been conquered, it follows a period of economic calm. An example of this includes the late 1990s, known as “the longest period of economic expansion in US history.”

That expansion was met by a recession in the early 2000s, and another at the end of the decade. The current macroeconomic climate does little to build confidence among investors or analysts. Despite that, Ron Baron is confident that the economy can keep up with historic levels of growth and deliver greater prosperity than ever before.

It is true that those who have argued for periods of long term stagnation, like many in the 1980s and 1970s, are wrong more often than those calling for optimistic and bullish growth. If some of the economic projections from those periods came to fruition, the current situation would be dire indeed. The future is unknowable, but if past performance is any guide to the future, it’s better to side with the optimists.

Whether or not the DOW Industrial average is likely to grow in the next decade, or whether it will hit 28,000 is fairly unpredictable. What is important right now, is that the equities market is expanding, but the economy doesn’t seem to be following along, and the labor market seems to be doing worse than either of them.