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发表于 2011-9-17 13:16
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Current situation
' X: x* y& g- @: O The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
" e: W5 b; @, Y6 A& cas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
4 U6 Y3 ?' o" m9 J1 o. ?! |impose liquidation values.
5 S- q- Z d( l) ~6 w! | In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In/ T3 @. D! j& q$ r, H- Y
August, we said a credit shutdown was unlikely – we continue to hold that view.
( D1 ]: g/ ?* a# Q: i* ^) t) D The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension( e( O3 P5 C" E
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets7 R6 t6 ?4 E Z
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
. v7 P o! M* t+ qSeptember. Non-financial investment grade is the new safe haven.2 ~" w. Q! S( U
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
$ F) n' [. X9 i$ `2 {$ D& F- fthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $10 Y2 A+ F4 Z0 K6 ~) ~ ]
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have6 ?5 ^" |# o, C8 X8 G
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade A- I4 U8 P0 W, ~- e* p
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are7 T+ _" ^6 K1 i: s- F
positive for the year-do-date, including high yield.
. K6 ~9 t4 D2 x0 l' B& [ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
* f" u9 g, x# I2 Z/ Jfinding financing.
' g1 e' v6 L8 T. y/ Y! h% {8 n Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
1 `+ A$ O/ E# ~) uwere subsequently repriced and placed. In the fall, there will be more deals.
; E3 X+ A2 g! S7 @! }: m Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and' w1 t, k9 i3 t2 Y( c
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ _6 O4 N- Z% k, b
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for* I5 O0 O/ l% D' B4 F) ~4 z
bankruptcy, they already have debt financing in place.
$ U# l- o% X2 h% g6 ^5 G: I q. h; u+ |3 k; [ European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 x0 h" R9 u i( u# ktoday." x6 w c) ?- Y$ ^& N* I$ H
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in# \5 p ]. r* E& g
emerging markets have no problem with funding. |
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