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发表于 2011-9-17 13:16
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Current situation
3 }+ K ~% b! ]$ a* v) q: M j The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
1 `6 q1 Y2 t q2 C- J9 H Sas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may( f6 ~! I2 N. \& _
impose liquidation values.
5 K! k9 K8 y( X% | In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In9 v$ [. G* W5 f' O( m6 D" z
August, we said a credit shutdown was unlikely – we continue to hold that view.
" U K# n0 u% |0 R/ E; F% b& R) F The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension6 ^1 J' f% E0 B- A# f
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.1 @% \, M. a8 T+ M" \! {/ X
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A look at credit markets
9 ?& f) }" W: z, t# F Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
1 G/ ]4 P. `( a+ m8 wSeptember. Non-financial investment grade is the new safe haven.
% u0 h: |, ?( N7 }/ Y High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%$ P1 |) k1 E) M8 ~( K3 d a3 L
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1: v4 m: S" R1 s4 o' T# E8 u0 v. l
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have& O* L* `+ {1 h+ C2 Q. l
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
0 G: f2 W$ q. h0 D5 o1 XCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are: R8 m @# \% l
positive for the year-do-date, including high yield.
# H5 Y. u9 ^% u* ^8 P Mortgages – There is no funding for new construction, but existing quality properties are having no trouble, ], ^& ~+ C9 E% I% I
finding financing., N" U8 @4 n* d
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
8 P! M' k: D' H) Kwere subsequently repriced and placed. In the fall, there will be more deals.% C. q$ J* g& M5 |4 B, N2 A
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
4 s! e, S& t. W7 F- H: ` ois now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
! q+ A- p0 G0 l1 s8 k, D7 [going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for& _1 n4 x4 O5 a/ ^2 K
bankruptcy, they already have debt financing in place.3 j; a3 M2 @7 j: P( F
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
5 W, ]' J0 v8 ytoday.& O4 A$ w. ^( _1 [7 `- G. z9 I, `$ G
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
/ O' o3 }. K5 l/ ~# Demerging markets have no problem with funding. |
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