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发表于 2011-9-17 13:16
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Current situation
) P) _8 \& r) t" H7 {- V The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
! W, k4 z3 ^4 b9 M# ias funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
2 t) ]# C) O2 k2 M+ uimpose liquidation values.; U5 E* X6 s1 ~& f8 \! x, e. j- S
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In' D0 R R. g7 t# Z$ x6 N
August, we said a credit shutdown was unlikely – we continue to hold that view.
# m8 q" p0 G: c9 P9 Y The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
# {; A- Q, h+ I3 ~* |scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
1 e9 ~# n, ^% p/ \) R5 N Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
U2 Z: @' @* _: F# v. ~. H: s4 ?! sSeptember. Non-financial investment grade is the new safe haven., K* J2 q7 }& c3 z4 u
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
; y2 j. r2 B7 {, Dthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
+ ^2 ]3 H- B4 g* tbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
1 {3 _3 n7 O2 _, D$ v/ Y haccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade/ }+ I; P8 ~7 Y$ @; Z
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are/ e3 T/ K9 n/ \1 `( m0 q
positive for the year-do-date, including high yield." e' {9 P0 A8 }" g+ F; \
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble5 s) @5 |5 {$ z6 R w. d
finding financing.
& R" I5 L9 i9 m" Y: L! k Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they5 ~) f8 Z: p: k) @. I3 R
were subsequently repriced and placed. In the fall, there will be more deals.
$ w" z( D& U, P$ ~& p3 G Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and! o! N2 K e; ~; e! B. B
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
1 u+ @. l1 ?! A# I( j9 G* egoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
+ }. E+ v7 S5 y- i, {: I; r5 bbankruptcy, they already have debt financing in place./ J" A3 _# w f4 G. b; `
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
- Y+ ]/ k7 Y: b8 [today.1 i9 D6 D+ S5 K# a/ [& l
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in+ {- T( T- m$ F8 x" E
emerging markets have no problem with funding. |
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