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发表于 2011-9-17 13:16
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Current situation
8 s: q% W* a& e. A! S' U The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long" \ g0 d. s9 W/ z
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
& i( C$ k' B1 b6 m+ \% c( ^# u6 Himpose liquidation values.# R3 p; i* ~. f5 Z6 e, }9 e/ t
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! Z/ s9 ]2 X0 n1 u( u+ NAugust, we said a credit shutdown was unlikely – we continue to hold that view.
- F! B* } l( \) @0 t8 Z9 w The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension" J* w# S/ _+ H* k1 R' A/ F. C) \
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
9 I; Y6 N, }! T' C, l' R! N8 ]0 g! w Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
' ]' B- Q) Q( jSeptember. Non-financial investment grade is the new safe haven.
; u/ B' V% c. F) T5 I- k High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
1 j" _, {5 i7 g; n( tthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1" u0 f3 c( ~ U
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
. O9 j/ n1 i! ?2 j9 \3 oaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade7 W, C/ K+ V1 c3 I1 Z$ C% V& {
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
' w+ _. W( I9 Z. O: Xpositive for the year-do-date, including high yield.: Q% ]. Q2 ]" P% ?# ]* z
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
% P ^2 ]: \5 W/ H* Wfinding financing.) ?& Z/ N1 l' r& S" |( m$ u. T
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
: r- `4 P. k# T1 O& Awere subsequently repriced and placed. In the fall, there will be more deals.
: c3 t& L/ z0 D7 c9 s3 A4 [ Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
2 m; s, f- x# ~& q* s' W8 R8 Nis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
! M% [. P1 n) ?- A) L" \# y& lgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
# W& y# V" w# \! f. K1 e1 P" vbankruptcy, they already have debt financing in place.
! I: Y: Q* @: x5 c) n& R" H+ Y! O European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" a7 T0 l8 I; v; n! X& {today.
" j+ R+ A3 I9 ?: \0 v5 J Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
/ T! ]' {4 I2 W ?' a' N1 Hemerging markets have no problem with funding. |
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