Lessons from History: Mehrab Irani

By Mehrab Irani, General Manager - Investments, Tata Investment Corporation Limited.   (intelligentmoney.blogspot.com)

Abstract

The current turbulent and volatility witnessed in all the asset classes including equities, bonds, oil gold, base metals, real estate etc and the synchronized global bear market which we observed in the year 2008 are leaving many investors totally agashed. There has been lots of panic and every investor, analyst, fund manager are debating whether this is a bull market correction or a bear market and if the answer is the latter, than whether a structural or a cyclical one. This article tries to answer those questions by studying the US and Indian stock market history, price movements, valuations, interest rates etc.

Introduction 

General Comments and Market levels

Economies and markets go through different cycles. As per Dow Theory (which according to me is the father of all technical Analysis and the most simple and logical), there are three movements of any markets which are publicly and liquidly traded. The first and most important is the primary trend

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