I don’t normally do a Friday round-up of interesting articles from other blogs, mainly because mine is still one of the newer blogs, but I found a few articles from yesterday particularly interesting.
1. Canadian Capitalist observed that yields in real return bonds show that investors are worried about deflation. His observation makes sense to me, but why investors are worried about deflation doesn’t make sense to me. I’m no economist, but I would have thought that the prospect of the US government printing trillions of new dollars to cover debts would make inflation more likely. Maybe deflation is more of a short-term worry. Maybe this is a difference between Canada and the US. Maybe I need someone to explain this one to me.
2. Preet explained that the usual measures of liquidity don’t apply very well to ETFs. Normally, if a stock has very few trades each day, a single trade can cause a large change in the stock’s price. So, if you place a market order to buy shares in a low-liquidity stock, you may end up paying much more than the quoted price at the time you placed your order. See Preet’s explanation of why this doesn’t apply as much to ETFs even if they have low liquidity.
3. Gail Vaz-Oxlade had a guest post by a woman named Alicia who has learned financial lessons the hard way. I tend to be a numbers guy who isn’t much moved by articles with artistic content, but this is an exception. Alicia manages to capture the frustration of being steered the wrong way financially by parents, peers, and finally a credit card company.