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发表于 2011-9-17 13:16
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Current situation" v! r% v5 l% p. o
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
2 _1 v) v* P+ b7 V5 i0 uas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may, N; @+ o7 w! I5 ?3 M* x
impose liquidation values.0 y0 ~, B, k5 O* U7 F; H) k
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
4 C: |6 U) v+ Y: E1 ]) YAugust, we said a credit shutdown was unlikely – we continue to hold that view." Y: N$ Q- ?: i% U7 y: h; c8 c$ l
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
5 n! K: W7 c* |9 ~8 W" ~7 \scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.0 l% a' ]6 \& k8 Z, r
) n8 Y- F2 b% \* ~8 HA look at credit markets/ O0 `# r# n2 |
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
b3 x; m, l( L3 @9 E2 hSeptember. Non-financial investment grade is the new safe haven.
* x: E# b C0 Q High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
/ L: W5 H& }* Y- ]3 I% u( @then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1; r6 m6 L3 i W# k
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have# l7 n7 ~7 [' X u7 {) `, }; [
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade& W9 |, {* e7 {8 _ l6 `
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
3 j( Z+ ]3 X2 b4 K7 k! `+ Ypositive for the year-do-date, including high yield.1 s `" M* n/ S
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble/ h9 N$ j3 V: l0 y
finding financing.' A. F2 ~, `9 a2 M7 q8 H7 y. n
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: ~4 J" t9 h% |- }
were subsequently repriced and placed. In the fall, there will be more deals.# o8 Y) x, `8 F: V2 Y
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and& b( L" d7 m( F* H+ z- N0 K
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ b1 U6 ^' i+ E" l: G0 c
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
5 v$ k) O# X# Vbankruptcy, they already have debt financing in place.( w- o, \3 E1 o+ f
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" p& @; C; E# y$ e* Z3 N3 ntoday.( o7 l% w/ O* [" Y/ @9 f; P" ^
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
* p4 k: E3 |* P$ B2 Femerging markets have no problem with funding. |
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