Here's a worrisome paragraph:
> Third, not only is fixed income more illiquid, but now most of these instruments – which have grown enormously in number, owing to the mushrooming issuance of private and public debts before and after the financial crisis – are held in open-ended funds that allow investors to exit overnight. Imagine a bank that invests in illiquid assets but allows depositors to redeem their cash overnight: if a run on these funds occurs, the need to sell the illiquid assets can push their price very low very fast, in what is effectively a fire sale.
> Read more at http://www.project-syndicate.org/commentary/liquidity-market-volatility-flash-crash-by-nouriel-roubini-2015-05#0PrKfRLYfyrIVmPh.99
I've wondered about bond funds. They seem to be some sort of income averaging device, with little chance for capital gains, and with considerable risk for a bad outcome. Why not just buy a bond directly?
Any bond market comments?
Gene