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发表于 2011-9-17 13:16
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Current situation+ ~- j3 _3 S: Z0 q1 d$ Z
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long/ T+ t+ T9 H' L2 A, Z- S
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
3 T1 n( u8 M# [% @impose liquidation values.% `* y9 |8 n2 g c( E! h4 M) W
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
. X5 C; O+ U2 V0 v& H7 KAugust, we said a credit shutdown was unlikely – we continue to hold that view.
4 H% y# m2 M0 } The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
8 l: @ a9 _3 h6 Lscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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- Q- f4 `/ G9 h6 K# ?: eA look at credit markets" k. y6 s1 ~. H5 O
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
9 E. s2 L3 S( X5 H0 D" {- K$ ?* NSeptember. Non-financial investment grade is the new safe haven.+ o" z4 K- ~. H# h
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
. g* Z9 P+ y! ^then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $18 W: N0 d9 }3 N2 a
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
5 y5 \, q; \; N, c& F! [' yaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* x0 B% z$ l, _6 {( l' e6 P
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are: _( n! S; a3 V
positive for the year-do-date, including high yield.7 q) H# X1 v; p7 Z
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
; V. Z! o% ]8 h$ {, j& ofinding financing.
9 {1 W3 N; F. z/ q Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: V# {' h( B2 \7 A# T) D ~
were subsequently repriced and placed. In the fall, there will be more deals.% _( D( _6 Q! @; g4 H& S! d9 e/ C
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
4 V+ F* y& T6 `1 }0 Dis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
* x) v7 E% s" l. M; b. \going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for1 d! v+ G) [% B
bankruptcy, they already have debt financing in place.4 \$ M; j& A$ Q. k
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain% A2 t( Y* T9 B1 s$ b& W+ @: M
today.( v' S) |9 r; I; g- V3 X3 \
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in' M A' z/ L* W! v# k9 u
emerging markets have no problem with funding. |
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