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发表于 2011-9-17 13:16
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Current situation
: @: p: v. ?3 e) d The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
( R$ H0 E) g! N* Z+ B7 Uas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
+ \4 @. y" }+ k+ I! `impose liquidation values.
0 H" O& ~7 ~4 r- J; F" ]( v% H* q In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
* ]% Y w5 C8 b" gAugust, we said a credit shutdown was unlikely – we continue to hold that view. F% s6 e& t3 T+ F4 h' c6 G
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension) g) R- \1 D' ?, O% Z
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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6 j6 w4 z' `- e$ H3 [$ _9 j% [A look at credit markets
7 L1 f+ `$ u& e% Z) D" _ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
3 i2 U& ?5 p/ tSeptember. Non-financial investment grade is the new safe haven.: O7 p& Z( ~$ v5 u" x2 V
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%1 o; E+ L7 s" K7 v. d" Y0 r8 Y6 E6 B
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1. h/ @/ S K- V5 i$ V
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have9 B' q. A5 @3 M9 I2 U
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* i/ j; q- s) X9 g% m K. e' l( R
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are ~3 I- B6 A2 _7 C
positive for the year-do-date, including high yield.
3 }5 G( H' j( x Mortgages – There is no funding for new construction, but existing quality properties are having no trouble/ t4 w0 a7 I$ p* l1 d( \
finding financing.4 r0 T; t% _; j: d9 k" H& x
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they' @- Y0 [" u- ?. r
were subsequently repriced and placed. In the fall, there will be more deals." S" Z! Y. L v4 I& E) c
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
3 L1 p, E3 w9 P3 V* Qis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were% c9 p- f# E5 y" i, n
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for; Q: e, r- ]3 c* u
bankruptcy, they already have debt financing in place.
2 P/ [0 Q, g* Q( f O6 `% ~ European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain% i3 F' l' S9 Y0 D6 g
today.9 w z% I9 x3 u8 {4 D, |
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
' X' w' m# \+ I4 M! z. q) ?emerging markets have no problem with funding. |
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