Ruminations on Russia

Two of the best i.e. returns significantly greater than the index, investors I have ever worked with in the tradeable market were 'flow of funds“ investors.  Which is why this paragraph from the Economist caught my interest:

Moreover, Mr Miller observes that the big slosh of liquidity circulating around the world is beginning to drain away. Interest rates have been steadily rising, and sectors that had experienced large price gains, such as housing and Middle Eastern equity markets, have cooled to a greater or lesser degree. Today, Mr Miller says, the common thread among the most popular asset classes, including commodities, emerging markets and smaller stocks, is a lack of liquidity. In a world where central banks are draining liquidity, Mr Miller argues, ”relatively illiquid assets are likely to begin to lose their allure. Liquidity will become more valuable.“

[composed and posted with ecto]

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