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发表于 2011-9-17 13:16
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Current situation. `4 Q2 v& v, k9 g" {( [9 c" w
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
: k$ v4 i- G c( i7 cas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
8 `& S1 X) G0 nimpose liquidation values.# y, T5 M2 W; _" k: N3 R' `4 k
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In" v- q+ M p6 d$ d+ U/ w
August, we said a credit shutdown was unlikely – we continue to hold that view.0 l9 w7 B/ v* m3 f K
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
5 w0 I" w# o8 Y9 Q' @scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.6 m4 a S, A" r9 e
0 a) y% s- A5 ~4 Y* mA look at credit markets1 s9 ?- N; d9 O) H; A
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
# U9 @+ H# w i& L. A3 b( p3 LSeptember. Non-financial investment grade is the new safe haven.+ ]- g- R2 w* ^5 f& X+ b& t
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%, K2 L7 M, Z' U) E0 P: y: w$ d
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $13 j" K. |5 W9 l5 U& o6 \ F* ~
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
. \" q' b& _; |# I0 |access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade6 s. M& {! _. \9 M
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are5 R. [& P2 } S: n; g
positive for the year-do-date, including high yield.
`8 @1 w& p, E3 P Mortgages – There is no funding for new construction, but existing quality properties are having no trouble# y, A9 r, d3 Y: Y7 p6 s+ T W
finding financing.( Z& l% H! W8 \! O8 N% Z
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they3 B4 ?, {" ?9 ^0 H2 U0 `4 w$ n
were subsequently repriced and placed. In the fall, there will be more deals.
6 N9 s) Z/ z2 p: j( j/ j" x+ p. z6 s Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
; B5 \" Y6 E% _/ q/ wis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
/ `3 w2 h0 a* b2 Z! ygoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for& u! l5 k, \/ _+ U
bankruptcy, they already have debt financing in place.
6 _7 X1 H5 L0 h- U* v European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain. B' ~- O! W# |5 ]: ]0 Z- d
today.
, d% B8 Y& X+ r" F( m# {4 f Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in: `- r( y J* R
emerging markets have no problem with funding. |
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