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发表于 2011-9-17 13:16
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Current situation
/ U0 p& _ R$ C: B# J! L7 Z3 x The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
0 p+ o. U( r2 |- _as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
! c5 P% s- r% w$ r& A* cimpose liquidation values.
. Y$ N# J, C/ j In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In5 W" [: m F* l+ B2 J$ h
August, we said a credit shutdown was unlikely – we continue to hold that view.
9 T1 R: E, m0 z The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension5 ?1 K5 x4 u7 d) T2 E& V2 c$ q
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.3 [: H0 U9 ]6 _" X
1 f9 _% l6 N- }6 d2 C9 q. RA look at credit markets0 |, I. m* U+ G, c9 [* y
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in+ P& T. W6 p& x# U, y! V
September. Non-financial investment grade is the new safe haven.- G" N9 P5 ~2 x2 r2 Z0 }
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%! Y6 s2 O5 ~5 ^ X- E; E
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1* R& ^2 q( H% ?1 m
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have+ c6 a# Q6 e; W$ A5 ?: v6 D& `% {
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
/ r& F! O; t% a# K9 F- k; gCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
2 C" |2 z( Z" ]" e. p+ Lpositive for the year-do-date, including high yield.
: A, W: l) |/ R) [$ X* Z Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
# z2 ^5 e! S. n$ }" X% ?finding financing.
* I) Y& ^+ Y4 z9 g1 F6 r( _8 M Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
* e& E$ G' i! ewere subsequently repriced and placed. In the fall, there will be more deals.
3 L- T% L% ^, e6 K) t. O Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and6 k/ ]! g$ ^/ ?3 m( f
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were& ?5 t+ B$ H5 K; x4 b. |. I- v2 R
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
& A- h2 Y) q: o& X2 Ibankruptcy, they already have debt financing in place.% w8 w+ H* n+ E% T# H6 [1 g
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
6 r- [8 y7 l. I$ H' }today.. a! U* y2 Y; s( n- v- x1 p
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
& r; g \8 ~* Yemerging markets have no problem with funding. |
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