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发表于 2011-9-17 13:16
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Current situation
8 ]" e$ u/ P/ q The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long( b- i% G+ _2 S V* i+ t
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
0 E% C3 U/ o3 p1 P$ q, B7 zimpose liquidation values.
2 m7 R* s, Y- f" E4 _ In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
0 _6 u# D" C# j# X- u9 Z) BAugust, we said a credit shutdown was unlikely – we continue to hold that view.
8 Z9 i+ Q$ j. [! N5 R5 m, J; `, ? The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
5 m) j( h' p* v4 lscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.+ L; z/ s/ H+ B: S. _+ G( q
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A look at credit markets9 g, P0 d: ]; U- H
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
1 Z6 F! v0 c4 o' L: U) G* qSeptember. Non-financial investment grade is the new safe haven.
' w! H l# Y0 U: p* }! F High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
( ], y3 e5 q, [( zthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1. t( |" Q; a8 e# x" n E* I( E
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
5 S+ V6 M9 ~4 Y7 X' faccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade9 u F' Y0 V5 p6 m/ v
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are6 Z" d) l8 g2 X# V O
positive for the year-do-date, including high yield.
4 m" j2 F) g) S# } V Mortgages – There is no funding for new construction, but existing quality properties are having no trouble, ~2 e2 V1 T- W/ D2 c
finding financing.$ L( y- J- V3 @8 D; E) Z& V
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
0 C) d9 R5 h6 {2 M5 G( E; j3 J9 swere subsequently repriced and placed. In the fall, there will be more deals. ]1 m3 P0 [* m
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and J( g$ `6 @' \" D( T; i, u; [" R
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
& C) k' {, i: o6 {going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
# I, ^& p, N: }7 {$ I# `9 w7 Ebankruptcy, they already have debt financing in place.% K: D9 Z+ b* x/ j' }
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
. m' |2 c! Y& ]% ^: Stoday.
: w9 ?" Q5 G, t0 F Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
- t* W- E7 {- k' a8 bemerging markets have no problem with funding. |
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