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发表于 2011-9-17 13:16
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Current situation' l) I8 O, z% i' y
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
5 E5 C0 b' T5 p0 Q! q+ Kas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
7 Q- @1 y1 Q2 a7 Uimpose liquidation values.6 b0 C; O4 }, \, c' j _
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In: g# a7 n/ H* c4 G( n
August, we said a credit shutdown was unlikely – we continue to hold that view.
5 y9 I& `5 h: m& a The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension- y; U( a1 O3 ~5 x2 {- j
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets. y P: X. e: O: n1 s e$ Y
}& `3 e n% Q y& ~) PA look at credit markets8 O3 t( d& ~2 b$ w! n; e, {
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
+ _7 x5 G' c7 c8 Z/ sSeptember. Non-financial investment grade is the new safe haven.
) I: r! b0 F9 d) a3 T0 S; J& J High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%7 Y! t% ~4 ?+ n: M7 V3 j
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1; A* y/ r! U& ]
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have! q& b1 b9 P2 l- f1 O5 e
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
1 f) G: s) U& y4 S( W/ I0 y- }0 kCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are% t: R: Y$ s- x- G. f* c" I( _
positive for the year-do-date, including high yield.
6 M4 c- H8 I8 l5 b n Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
+ l9 P; F+ s( \6 z0 u$ o- |finding financing.1 e8 [1 L' D0 W% T9 z* J
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they( M1 _' J N; @& g1 W4 K
were subsequently repriced and placed. In the fall, there will be more deals.
) D5 |+ g" B; O$ [: O K3 |) y Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
/ J9 O1 s5 W, mis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) ^5 Q# Y$ ?# C0 j/ A9 e3 igoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for5 _. U2 Q" i+ a
bankruptcy, they already have debt financing in place." }+ e j% k8 @1 o3 a9 s$ r7 g
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
9 z( H1 |9 @- _* X3 g( y* Jtoday.2 r# h i. O0 T v6 `0 f
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in* x5 \. V+ e1 d8 Y z# }
emerging markets have no problem with funding. |
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