Dear Sir/Madam,


Well we are a quarter of the way through another year already.  I'm reminded of time flying when I see our oldest daughter having just finished her half yearly exams and realise that in 6 months her HSC will behind her.  She'll be 18 then and she is no longer our baby!  We remember her early years still so vividly.  It makes you think you have to grab every moment and memory together as life is marching by!
 
The markets are not running with this marching by concept though!  They are correcting.  For some time you'll remember my previous newsletters forecasting an economic slowdown around the world and therefore lower returns from your investments for a season.  That season started 12 months ago last April.  When I look at all the markets around the world, their charts are almost a mirror image of each other, including the commencement of the possible slow recovery in mid February 2016.  
 
This is a buying time, not a selling time.  
 
There are some investments out there at a discount and your fund managers are feverishly setting your portfolios up with these in preparation for the inevitable recovery.  In the interim though you can expect markets to be volatile with daily swings of your investments of 1% or more in each direction.  
 
This is normal and to be expected given the convergence of several global themes currently effecting the world - volatile oil prices caused by the price war in the Middle East, Interest rates in the US and a slowdown of infrastructure investment in China as they transition to a consumption based economy and start using what they've built.  Some people fear another GFC on the horizon.  We agree with the view of BT and many others who believe that this will not occur because the significant debt accumulation this time is mainly contained to the emerging countries, not the large and established ones.  Secondly the central banks all understand much more comprehensively the impact of contagion if issues are left unaddressed (like the US banks collapse during the sub prime crisis in 2007) and will move quickly and decisively.  Finally banks have typically strong balance sheets, are more highly regulated and can withstand write downs if needed.  So don't worry about another GFC!
 
On a personal note.....we'd love to welcome our new Client Services Manager, Kylie, to the growing Chrysalis team.  You may have met Kylie already.  Kylie brings a wealth of financial planning back office experience to Chrysalis as she heads up the admin team.  We 're really pleased to have her looking after you.  Some other exciting news......Jo is having a baby in mid August!  We wish blessings and safety for Jo and the Wihongi family.  Jo will be taking maternity leave for several months to do the midnight shift!
 
All the very best to you and your family until next edition.

Chrysalis Lifestyle Planning

Chrysalis Advice team

Chrysalis Lifestyle Planning

Website: www.chrysalislp.com.au

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