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发表于 2011-9-17 13:16
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Current situation) j/ P, u" |7 ^* G, Q7 {
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
) _. i& V9 a# W1 R N' s0 _& c2 bas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
- F) l& n" i8 z4 N6 G" B2 Rimpose liquidation values.7 A& m& d0 t9 q+ N$ U. b
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
5 j- e3 z9 u, G) BAugust, we said a credit shutdown was unlikely – we continue to hold that view." L( y& {5 v) i
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
( M( L+ g4 { [. [8 ^scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets; i; i2 x7 x! }4 E- E3 c% K
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in/ W2 w$ \( X& a: U+ C' z- e: u( J
September. Non-financial investment grade is the new safe haven.
1 I# d4 |, Y8 p High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%1 X2 w+ o' V+ E
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
5 f$ m6 V5 I9 [: R! x2 ubillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have1 V. L3 n* Q4 @* N) m2 N
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
" J2 ?! R$ P+ j, R% f4 b0 mCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are9 v- i( W q7 a0 v: E
positive for the year-do-date, including high yield.
* K3 m& O C t/ @7 k) d+ M4 ^ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
5 ?. I) M- ]# o$ a' d$ S+ w4 afinding financing.
6 `$ h* Y% Z% i& [ Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they6 ]) P, k1 b5 V- m
were subsequently repriced and placed. In the fall, there will be more deals.) G" Y6 ]8 b& d! r* Z& G+ f# O
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and- v5 y& O% J5 W' N: j. G) n% Z" B) n
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were# g% x! Y# w1 @. a" {; [9 V6 L
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for" `' c! k# U' P) z/ l
bankruptcy, they already have debt financing in place.
( m6 y' G. R2 s: t' Q0 c Z European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain3 h( X; h$ l. m; `8 |: r
today.! ?* J1 M! \% \. f
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in9 E6 }7 S* F; L) X! j: z0 Y
emerging markets have no problem with funding. |
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