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发表于 2011-9-17 13:16
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Current situation! c5 J4 t' I5 s; J
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
( @' [& R$ L2 I& A$ w" H1 s, d; Fas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may- P5 H9 T6 l$ E9 b& O- b1 M5 L
impose liquidation values., \, b1 q8 E% F
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
) j$ G/ B d* G+ J) E2 RAugust, we said a credit shutdown was unlikely – we continue to hold that view.7 `7 w3 P& e+ T, y- S6 [7 X
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: e6 I1 k! @1 y" {1 H/ H
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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: J+ D' n: c s" r* |A look at credit markets, a3 I5 ]+ n4 P- i. r5 ]$ D; [2 O1 E
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
) F& r! ?# l4 g+ l0 u/ T3 xSeptember. Non-financial investment grade is the new safe haven.) a% H& x( | w `6 u
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
3 D/ K% p2 i; Q! Ethen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
B" }5 ]& E5 Z% F2 u3 p, Z' ebillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have' ~( \' n* b# p4 C( A
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade2 Z v% r) _- ~- D) x2 T
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are3 H# j7 E* ?9 a1 o7 K; W3 }
positive for the year-do-date, including high yield.
! _- T# s6 {; V+ t2 q y7 [& j' A9 J Mortgages – There is no funding for new construction, but existing quality properties are having no trouble6 k5 J# O; F7 U3 f; ^
finding financing.+ s7 X0 l$ C4 k0 K/ f1 q
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they4 m0 ?7 u- u' e! L
were subsequently repriced and placed. In the fall, there will be more deals.& \7 D1 }1 N: d5 E0 g% a2 i
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and5 k' Z/ O5 \0 `! X% h+ [7 V% b
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
1 b7 Z8 [! P% E- D7 Kgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
7 L5 h+ v1 r: A) `+ _1 |5 v- O/ Qbankruptcy, they already have debt financing in place.
1 a8 E l: _# Y9 A European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain: B0 p3 H- `$ e/ K% o" r
today.
7 d c- \- Z1 {" D4 T$ m5 s( \7 M$ g Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
Z+ A2 I) j7 s+ k9 q( {+ wemerging markets have no problem with funding. |
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