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Australian Investment Blog

Morning Report 25/08/2015

Morning Report Tuesday 25 August 2015

Our Investing Journey Together, Clearly got Tougher, but also VERY Exciting!We started writing this report before 6am this morning, after basically no sleep, courtesy of an amazing night in the markets. The Dow closed down 588 points, BUT over 500 points above its intra day lows - yes the Dow was down over 1000 points at one stage last night! Clearly the news is full of all the reasons why equity markets are "collapsing", but often context is forgotten for a good story. The Dow had rallied for over 3 years without a 10% correction, that is statistically extremely unusual, as opposed to what we are experiencing now, which is actually common, just more dramatic than usual. Very importantly, we believe this is a sharp correction within a bull market, NOT the start of a bear market - similar but more dramatic to what we experienced in 2011. We believe the market is simply punishing investors who were greedy / too optimistic and forgot that markets move in cycles and the odds were clearly in favour of this current corrective move.


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