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发表于 2011-9-17 13:16
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Current situation
( x2 x6 T: m( a3 {4 [ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
# e& v# u4 C, J, ^9 z: |+ B* tas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may' K* `5 ~! f k0 a' D# q! h5 @
impose liquidation values.* I8 Z( `3 x" ?/ g. Z
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In) k2 ^) t( N1 z
August, we said a credit shutdown was unlikely – we continue to hold that view.$ R) M: e2 K, [/ y& d) P1 S
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension5 p- _% R, N9 b+ H7 M) q8 d" d
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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) D( z7 C& z6 t; ^5 q( RA look at credit markets
3 r) D1 W: t8 K2 Y7 G3 E Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
3 ]" A% q% r: y; Q! P d! ~5 USeptember. Non-financial investment grade is the new safe haven.8 i! E; R m* e
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%; f% r, c8 x z E0 _( i- i8 Z0 i
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
) y" w/ y3 o: x; b2 ubillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
7 {# P9 k2 j7 N" [6 A2 F Oaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
7 O: ]4 m/ C4 q1 @6 a7 r$ kCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
5 K* M8 }! L- h, ?0 Jpositive for the year-do-date, including high yield.6 V/ m. o: x1 c* o
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
* }' M0 `0 n2 ?. R& t) I, x8 Jfinding financing.+ S% P! Y5 i* f2 Q1 L+ f( T+ O
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they4 a; h9 `' v6 ~7 ~, u J9 k
were subsequently repriced and placed. In the fall, there will be more deals.
2 R1 q# B: Q! s/ f) ?; k$ Q Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
& u$ i0 J8 [, E2 W9 q( T4 yis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were) O8 o9 H: h2 r, S% k' z
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
1 D8 f. i7 D& { z6 v7 kbankruptcy, they already have debt financing in place.& t) A' U7 c& g; ]$ r2 m
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain. U) A1 V8 ]7 C
today.
/ C. e" ~2 \. X5 e8 p- N Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in% F! O2 ] O6 J3 q& Q# A
emerging markets have no problem with funding. |
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