something from magazine

I read some interesting articals this week probably worth writting them down

1) one way to see the liqudility in the market is to see the spread between the corporate bond and treasuries. In a market with loads of liqudility, the spread is very narrow cause all investor want to invest their money.

2)A reasearch found that only 15% of PE's return is from the value created, most return for PE is from gearing. All retail investor can replicate the return by those PE by borrowing the money to buy stocks. Private Equity generates the high return by taking more risks, it's like a man with 1M pounds he can either buy a 1M house or take a mortage to buy a 10M house, when the market goes up the increase in 10M house of course beats the return from 1M house. Those PE manager does not necessarily have more advanced skills than normal mutual fund managers. To be fair if mutual fund managers borrows money from banks to buy stocks they are sort of PE in some way.

3) In australia they start trading waters in one rivers. Each farmer allocates a quote, those who don't use all the quote can sell the quote to ones who need water. The trading, in some way, can result the water is used in the mose efficient ways, to produce same amount of food some farms use much more water than others. When the water is free, those efficent farms do not have any advantags over those inefficent farms, everything changed once water has a price. Is it a start that water will become a commodity, and possibly potential investment oppertunities. Currently there are ishares track those water compaies, in next few years to come, now, I believe water has a huge potentials