The net flows, which are often the focus of analysis, conceal a lot of important information that is only evident if you look at the gross flows.3 Another example is thinking about the financing of the corporate sector, where the preference for debt versus equity funding varies considerably depending on the nature and size of the business.
Just looking at bond and equity financing in aggregate again conceals much of the interesting information. 4. Stocks matter at least as much as flows. Just as a disproportionate amount of analysis is partial rather than general, stocks are very often neglected in favour of flows, as on the price side, are levels rather than rates of change. 5.