 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
, ~, M/ i% I; |! @! O( X% Q The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
4 m0 L" f9 P5 _" [as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may O4 H& s% D4 j: \) |5 Q) G" \( }
impose liquidation values.9 Z: V; O3 F# B# R7 x. H# y
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
7 \: e1 |. h& {* H7 hAugust, we said a credit shutdown was unlikely – we continue to hold that view.+ r5 n3 ^) y5 m+ X$ `
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
' G/ J1 A6 g- v- wscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets. l S* O0 \2 A( z: r7 s" E
9 N z' }" u% J" X$ d6 f8 YA look at credit markets7 s. u: x- `0 a, {8 j. b# c! w
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
$ f- n% B- w: KSeptember. Non-financial investment grade is the new safe haven.; `5 x) j# N3 Z/ @2 ~
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
" X* m- P' l: r2 w: sthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
) `& J: p" [( R# Y/ i" `billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
! Z# _6 [$ w$ i: K4 Uaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
8 K, s) F( p; c- D, ~' FCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
& B h7 y4 W% V! C4 d( Cpositive for the year-do-date, including high yield.
9 z4 I% K2 D) {/ \, k; O3 I Mortgages – There is no funding for new construction, but existing quality properties are having no trouble; [! [) P9 G$ q+ Y: K; W
finding financing.7 L0 g9 L% U& r
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
8 y B. X' T+ R/ d( e* kwere subsequently repriced and placed. In the fall, there will be more deals.& J+ [2 E7 _- J( G1 Q6 }1 N/ _
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and9 a5 E. g! i% n/ f) v! w) p$ {0 b
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
1 c; j: c. |. S/ R) g9 Sgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
1 R }: h' [" z2 q& hbankruptcy, they already have debt financing in place.) I+ q& M- ? `, X
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
# X$ q% `, j0 Ptoday.. Z+ }+ g0 t7 O: P
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
5 [) ]; P6 o. l3 t2 Demerging markets have no problem with funding. |
|