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6 February 2018, 13:12
No one likes falls in stock markets if they are invested in them. Nearly every British adult, plus many millions of children too, are investors - even if they do not know it - due to the ubiquity of pensions, stocks and shares ISAs and life policies.
Yet there are reasons why these latest declines will be greeted with relief in some quarters or even welcomed by investment professionals.
Why? Simply because the markets, especially in the US, have been on an absolute tear during the last 14 months and a correction was long overdue.The longer they simply carried on rising, without a pause, the bigger and nastier the eventual correction was going to be.
The US stock market has been rising solidly for almost nine years and the FTSE-100 for nearly as long. And stocks everywhere, led by the US, had a stellar 2017.
The best guide for this is not the well-known US indices, such as the S&P500; and the Dow Jones Industrial Average, but global indices like the FTSE World All-Share Index and the MSCI World Index. They respectively rose by 22% and 20% in 2017.
Yet this has been the most unloved bull market in history. Following the euphoria of the dot-com bubble at the end of the 1990s, which was followed by three years of market declines in 2000, 2001 and 2002, and the run-up of the mid-2000s that was followed by the financial crisis, many professional investors - and their clients - have become wary of markets going too far and too fast.
:: LIVE: World markets latest
Stock prices as a proportion of company earnings, the traditional yardstick deployed by investors, had started to look highly-valued.
So some sort of correction was inevitable. And here it is.
Before getting too carried away though, it is worth pointing out that although the latest falls have been spectacular in points terms - the Dow's 1,175-point fall on Monday was the biggest in history - they are less so in percentage terms, due to the way markets have risen.
The Dow's fall on Monday was only 4.6% - small compared with some of the vast double-digit corrections seen in the monster corrections of the past, such as 1929, 1987 and 2008.
The interesting thing about this round of falls is that there does not appear to have been a particular trigger. But what undoubtedly crystallised the thinking of a lot of investors were figures last Friday lunchtime which revealed that average earnings grew in America in January at their strongest pace for four years.
Bond yields - which rise as prices fall - had already been rising in anticipation of a pick-up in inflation and interest rates. The payrolls data strengthened that conviction.
Higher bond yields make stocks less attractive and higher interest rates increase the cost of borrowing for businesses, potentially, their profitability and their ability to generate returns for shareholders.
:: Why are stocks tumbling across the globe?
The big question is whether this is merely a healthy correction, an opportunity for investors to bank the profits from last year's gains and take some money off the table, or the start of something more serious.
To that end, the fact that European stock markets - having opened down by 3% or more in most cases - staged something of a rally on Tuesday morning is encouraging.
But one big difference between the situation confronting investors now and the scenario they have faced during the post-crisis years is that central banks everywhere are withdrawing the vast injections of monetary stimulus - Quantitative Easing - they provided in that period.
The US Federal Reserve has already started unwinding its asset purchases while other central banks, such as the Bank of England and the European Central Bank, have stopped adding to theirs. The latter, assuming the Eurozone economy remains perky, may even start unwinding its own programme of QE before the year is out.
So bond markets will not have the crutch on which they could rely in the post-crisis years. That may have a knock-on effect on stocks.
In the meantime, following this latest setback, some will argue conditions are still ripe for further progress.
Inflation remains relatively benign by historic measures, interest rates everywhere remain very close to their all-time lows and company earnings are still growing.
That may particularly prove to be the case in the US, where Donald Trump's tax cuts have boosted corporate confidence, with mergers and acquisitions activity enjoying its most buoyant January since 2000.
And this latest sell-off will create buying opportunities. The FTSE-100, for example, is now trading at less than 14 times expected earnings - which is below the long-run average.
Possibly the biggest unknown is the extent to which the composition of markets have contributed to this setback and will contribute to future ones. Trading is more automated than ever, while more retail investors than ever are invested in "passive" funds that simply track the index, rather than take a view one way or the other on investment fundamentals.
That means any momentum in a market - either up or down - can be hard to stop. Adding to that is a decline in the number of market-makers - the traders who stand ready to buy or sell any security and who perform a vital function in the market by providing liquidity and absorbing shocks.
That is likely to mean more sharp falls - and sharp rises - in the future.
(c) Sky News 2018: Record drops in share values will be welcomed by some investors