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发表于 2011-9-17 13:16
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Current situation
& D, R' z" X$ ~& O; M" i5 I* k) s The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
( U% O' R" f" c) d% w* Pas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may6 S5 T! p, z/ q
impose liquidation values.1 N$ S# {2 w; Z2 j$ D7 \
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In$ z) v1 V' d8 C- M' ?& F
August, we said a credit shutdown was unlikely – we continue to hold that view.& n7 ]# l, W5 {% L; F3 m
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
* `8 i: x6 Q6 rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets( @& h+ Z( \% J& u6 V
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in, b; z% E% m- _5 K) h; o- y# ^4 o
September. Non-financial investment grade is the new safe haven.7 s( c* @! ^8 t- w! |
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) s! w3 B: c7 Z# a8 C- U
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
4 [& z. N- O. X- B7 X0 `$ F! h8 Zbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have7 i9 d# B0 W3 |8 U" m2 ^, {1 ]
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
2 V h* n# t$ y8 q% d! lCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
- ]6 f& K- D1 x ^- n4 wpositive for the year-do-date, including high yield.
" P$ S* H `+ z) V% n Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
4 q5 x6 |8 w0 w* e& Vfinding financing./ ~( O& |9 U" l; T: A' n3 O2 |0 F0 j
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
5 s' z0 I# `' } h! ewere subsequently repriced and placed. In the fall, there will be more deals.
$ a3 x2 Y# b5 Q0 H( T# [* l Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and. m+ y, d F+ r5 X
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were; [1 U& ?5 U# K g
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for1 b4 J$ N$ y% ]' Z" T
bankruptcy, they already have debt financing in place.
. B! r9 A$ @5 M1 Q1 `6 m European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
) t3 z" k5 y. s# |/ ]( I1 _# htoday., S7 u# L6 Z3 I: v
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in- @$ }4 c# G( o
emerging markets have no problem with funding. |
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