Well, eventually the bears had to be proved right. We are talking, of course, about the much-predicted drop in US equity prices. Since its high in March of 7,085, the Dow Jones Industrial Average - the closely watched index of 30 blue-chip stocks - has plummeted by over 10 per cent, with the result that returns in pounds sterling on the index for the past 12 months have been a very lacklustre 8 per cent.
And when the US market begins to slip, stock markets around the world follow suit. Over the past month, $350bn has been wiped off the value of shares in international equity markets. The question now is whether the global equity bull run is genuinely over or whether we are witnessing a temporary blip - "a healthy market correction", as the optimists put it.
The cause of the downturn was the Federal Reserve's recent decision to increase interest rates (which makes equities a less attractive proposition). It was the first rate rise in two years. However, US wages rose last month at their fastest rate for seven years and the economy has been growing at an annualised rate of 3.5 per cent for the past six months. As a result, while inflation has so far been kept under control, most analysts are predicting that further rises are inevitable and the US equity market now faces its toughest test for some time.
Although the US boasts eight stock exchanges, which between them list more than 7,000 companies, the New York Stock Exchange (NYSE) accounts for the lion's share of business with multinationals like Exxon Corp, Coca-Cola and AT&T as the biggest constituents. Running in tandem, the Nasdaq market is dominated by companies like Microsoft, Oracle, Intel and NetScape - high-tech stocks which last year formed the strongest sector.
Naturally enough, it is this sector which has had the furthest to fall. "We believe, however, that companies like IBM and General Electric have now been oversold," says Andrew Withey, investment strategist for HSBC James Capel. "The pharmaceutical sector including stocks like Pfizers is also beginning to look cheap."
However, after so many years of economic expansion, a growing consensus believes that with too few workers to hire and too little unused production capacity, it will prove difficult to continue to raise output without exerting upward pressure on costs. "Although when corporate figures are released each spring the market generally goes through a period of volatility, the difference this year is that the Federal Reserve is genuinely concerned at the pace of economic recovery," says Withey. "Some sort of slow-down is therefore inevitable."
In stark contrast, with returns approaching 70 per cent, Venezuela's population has enjoyed one of the best-performing global equity markets over the past year. Well, perhaps not the entire population. Many of the country's 22 million citizens still live in shanty-town squalor and, like much of Latin America, the divide between rich and poor is not so much a thin line as a gaping chasm.
'Twas always thus. In 1973, when there were just over four bolivares to the dollar, while most of the population - then, as now - lived below the poverty line, Venezuela was the world's biggest importer of champagne and Chivas Regal whisky. Living standards have fallen since the collapse in world oil prices, but with deposits the largest outside the Middle East, oil remains the most important sector: every $1 rise in the price of a barrel of oil adds an estimated $1.1bn to Venezuelan revenues.
The government has recently reaffirmed its commitment to privatisation, and while labour disputes have rattled investor confidence, these are likely to be resolved soon. With the exception of certain media companies, there are no foreign investor restrictions on Venezuelan stock.
Another top-performing equity market, with the 66 companies listed in Harare having returned around 70 per cent over the past 12 months. Self- sufficient in food and energy, the former Southern Rhodesia still, however, suffers from high inflation and unemployment, which is approaching 50 per cent.
Although this is the most developed equity market in Southern Africa after the Johannesburg stock exchange, liquidity is not a strong point; the five largest companies - which include Barclays Bank of Zimbabwe, Hippo Valley Estates and Bindura Nickel - account for nearly 50 per cent of market capitalisation.
Performance Statistics: Datastream. Fund research: Micropal
Around 150 unit trusts invest in North America. Best-performing over the past year are Old Mutual North America, Fleming Select American and Govett's American General. Best-performing investment trust is run by Hendersons. Best-performing Latin American investment trust over the past 12 months is Abtrust's Latin American, with the best-performing unit trust managed by Abbey