 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
5 g7 m" i3 s/ Y8 I! P The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long3 R6 B3 u: y% t
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
0 A5 ?0 ?$ [4 l1 N$ yimpose liquidation values.1 L" ?) Q- k( z9 p
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In" u3 A) |1 L! i! K+ l% x
August, we said a credit shutdown was unlikely – we continue to hold that view.
5 L3 h3 Y* N4 ~9 L! }# j4 l The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
3 H$ G" B, x" P' Z' }; zscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.5 ^! s1 a) ]( `3 S# B2 O
' e8 Z8 G& y& i! z4 C- c
A look at credit markets' s4 a3 h& M m" V1 F: b
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
6 I2 J. R2 `% I* [0 tSeptember. Non-financial investment grade is the new safe haven.8 e' l, q6 T! N% }+ U) \+ a
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
: S( X/ ~0 ]' o* [& e! Tthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1( I: V2 H, u \1 u7 {( ]
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
& ?5 h5 K/ j9 I% z0 uaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* r x6 e1 J' q- z. R2 n: o. q+ h% ^
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
- C( w6 I" V3 v) A$ h4 r0 i- L, Upositive for the year-do-date, including high yield.$ V; _1 g. [; F2 d
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble Z9 b5 q/ g* H! k
finding financing.
, w# f# g# @6 _ Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
( M! x7 a" \/ m6 j) v' ]% r9 {" cwere subsequently repriced and placed. In the fall, there will be more deals.
, C4 |2 Z$ a& M8 i. Q2 P" \ Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
4 @4 U [/ h: X' a( N! l4 cis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ N# V; C3 V [; {" c6 a
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
7 |0 T0 ^9 F3 ]$ N( Rbankruptcy, they already have debt financing in place." ?) `* x N* ]9 W& \2 A+ G9 K
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
4 k6 h- o i6 P/ j" \" Dtoday.* ^8 |# }0 t$ a4 s6 e6 e
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in' c0 ^3 ~+ T1 X" I) y
emerging markets have no problem with funding. |
|