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发表于 2011-9-17 13:16
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Current situation
. T( Z: \! y5 f9 B+ }; p The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long% m7 V5 m: r! i
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
" y- P# Y8 k6 s1 W6 e* pimpose liquidation values.. z: M( A7 O; d# i) d9 X, g
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In2 m. v& V7 k2 O: B0 T) P. q
August, we said a credit shutdown was unlikely – we continue to hold that view., e% v3 l4 M6 I0 `7 ^
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension& Z7 [' U: W0 k7 B
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets., E3 D1 b R+ m# ?
: D+ k( q& A4 c V! n& q- T" RA look at credit markets O9 h8 a* ~! x! o* U# j
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
$ S5 d" e5 L6 [" m: O- VSeptember. Non-financial investment grade is the new safe haven.) y- W( _2 N2 t
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%# s4 w) r$ Q. j* m. P, A
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
" M# Y8 O+ h n4 F- K* \, ubillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have T# e) Y" h( N1 u) m
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
# B8 C2 O! ?0 s1 E; P$ u9 s! ]CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
8 n1 r8 R1 X, x- Wpositive for the year-do-date, including high yield.5 l. ]- c7 p$ |( ^" e& O3 v2 P
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
7 R* H: J0 B4 m! @finding financing.5 v8 s( O5 n7 T+ J0 z% F
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
8 n( G$ h* P ~0 v5 G+ Fwere subsequently repriced and placed. In the fall, there will be more deals.
5 \ x* |7 o- V, }2 D4 e Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
$ ^0 I! o; _) D1 n# \% Nis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
0 L0 K8 U# B& Q: `4 h6 W, Qgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
/ ~) N) M2 }+ x7 f! ybankruptcy, they already have debt financing in place.9 k5 g* o M# O: }, m2 u, z& _ v
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
3 z# Y$ F9 Q- G) }7 Qtoday.
0 S: j5 a/ n: k6 n) t4 ` Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
. d/ x+ \* b6 N! T/ g7 ~emerging markets have no problem with funding. |
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