 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation2 _3 T g, o& o p7 K0 l
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long- S( c- ]8 c. R
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may% _0 }6 Q3 w0 Y; S
impose liquidation values.
" s; [5 `. R# _+ v$ V! Q. v0 y In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
k; x7 e' G3 F8 d& i! k6 @August, we said a credit shutdown was unlikely – we continue to hold that view.4 e8 @5 F% I- A) t. q$ F% y( m
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension0 ?9 N. m( `& o- O) H
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
& ?6 ?. m5 ]0 u2 {3 P3 K$ |: j, \' @+ }3 @; R. F$ |) z5 e
A look at credit markets9 v; d5 e) N! O+ O' W4 k
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in T! g7 [! L7 F7 E, s( G
September. Non-financial investment grade is the new safe haven.
+ X- n; g) [0 H( {, [1 a9 w3 W' M- d, v High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) h+ }. a2 e) l% H5 p4 ~1 W1 R2 t) O' I
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1' S. l5 P( x; _( U. V, w5 X! n3 g
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have( y; f) [8 W8 W7 y4 Y+ b8 F; ^" X
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
5 W. u" w% y8 T7 V L: q4 YCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are; F; A: c" W" ?/ o( v7 R) o& _
positive for the year-do-date, including high yield. J" T8 Y2 D2 g
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble ?' [$ d( f+ s' b2 W
finding financing.
1 A1 D$ r! g# O) F- p- ] Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they2 O; R* N! L# X! u. C
were subsequently repriced and placed. In the fall, there will be more deals.
# d5 ~6 _1 @8 ~+ T" @9 a* E Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
2 t% }3 B2 N! Z9 ` w) O1 u& Gis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
9 {# r$ R7 T& rgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for8 S6 ]: t/ e9 Y- z. D
bankruptcy, they already have debt financing in place.
) g+ F' W! H7 z7 l% m European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 `+ Z1 {) c, B0 b5 Y1 f" R7 Mtoday.
2 S, ~0 |) G3 x4 \ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
/ K% o4 v ^: V5 @1 Gemerging markets have no problem with funding. |
|