Prior to the onset of the global financial crisis, stock markets had enjoyed a two-decade bull market, punctuated only for a short time by the tech crash in 1999 and 2000.
Australia's economy had enjoyed a similar stretch of prosperity, exiting recession in the early 1990s and barely stopping to catch its breath in the intervening years.
With such a long unbroken period of prosperity, there were investors and business people in their mid-30s who had never lived through an economic downturn in their adult lives. That we had such a long period of growth is likely the cause of a great deal of our current pain - but also means we don't have the recent memory of how we successfully navigated the last downturn.
Of booms and busts
Some are learning the lessons for the first time, and others are re-learning some painful lessons.
Regular changes in government tend to moderate the excesses of either party, and many a long-term government has suffered at the polls from the hubris that inevitably comes with success.
Economic booms and busts have a similar impact on our financial lives. Remembering interest rates in the mid-teens, percentage-wise, moderates house price growth and mortgage levels.
Fluctuations in unemployment remind us to keep our personal debt modest and a rainy day fund well-stocked.
On the other hand, the memory of recovery reassures us that "this too shall pass" and regular economic downturns keep a rein on irrational exuberance.
Lulled into false senses
Like a government in power for too long, a two-decade stretch of economic growth lead us to fall for the promises of a "new normal".
Of course, it wasn't called that, but fading memories of tougher times lulled us into a false sense of security. We borrowed more, spent more and spent today on tomorrow's promise of more money.
No sector of the economy was immune, with property companies being forced into shareholder-crushing restructures and borderline retailers which had succeeded on the back of burgeoning credit card balances all of a sudden finding the going tough as consumers retreated from the stores.
Businesses which had an operating model requiring the good times to roll on were in trouble when the rolling stopped.
Those who can remember the 1980s and early 1990s will recall a particular phenomenon that characterises these times.
As has always been the case, tough times are a refining fire through which businesses (and investors) must pass.
The weaker businesses perish, and the more robust businesses come out the other side in a stronger position - both because of the reduced competition and because of the cost-cutting and other efficiency drives that allowed them to remain in business when the going was tough.
This current downturn is no different - some businesses have closed down or been acquired by the stronger ones, and those that remain are finding ways to be more efficient and better meet customer needs.
Platinum Asset Management (ASX: PTM) is a high quality funds manager that is suffering because investors are shunning equities and an uncharacteristically poor investment performance.
The business has earned a formidable reputation through strong investment returns over a long period.
It makes money by charging a base fee for managing clients' money, and earns a performance fee for achieving certain investment benchmarks. It's no wonder that the last couple of years have been something of a one-two punch.
If we accept that the equities market is cyclical and that Platinum's investment performance is likely to return to even near the level of previous years, today's share price will likely look inexpensive.
Low volumes mean lower profits
Most shareholders will know Computershare (ASX: CPU) courtesy of the dividend statements and other company documentation we receive from time to time from the companies in our portfolios.
The company is the share registrar of the majority of Australian companies, as well as having an impressive international reach in share registration as well as other divisions with very similar business processes.
With sharemarket trading volumes very low at present, and not a lot of "corporate activity" (analyst jargon for takeovers, new market listings and other similar moves), Computershare's profits are at a cyclical low point.
When that activity picks up (recent capital raisings also help), Computershare should be seeing significantly higher profits.
Mother Nature and Ben Bernanke
Also in the same situation is QBE Insurance (ASX: QBE). Hit by large catastrophe claims last year, and earning a pittance on money invested in US Treasury bonds, the insurer is at a cyclical low point, and with the added baggage of payouts for the Thailand and Queensland floods and Christchurch earthquake, profits have sagged.
Insurance is a 'lumpy' business, with natural disasters refusing to come and go on schedule, so shareholders should expect volatile profits. In the good years, and when its investment income picks up through higher rates on US bonds, QBE should be much more profitable than today.
Investing is never certain, and telling the difference between a cyclical downturn and a structural change to an industry can be difficult. Nowhere is that distinction harder to discern than in retail at the moment.
However, the companies above are very likely to be going through a cyclical lull, which is the perfect time to at least add them to your watchlist for further research.
Are you looking for attractive dividend stock ideas? BusinessDay readers can click here to request a new free report entitled Secure Your Future with 3 Rock-Solid Dividend Stocks.
Scott Phillips is a Motley Fool investment analyst. You can follow him on Twitter. The Motley Fool's purpose is to educate, amuse and enrich investors. This article contains general investment advice only (under AFSL 400691).