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发表于 2011-9-17 13:16
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Current situation# J3 _! o1 D8 y% G& z3 D. [
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
" _$ f1 b( C& v M$ V" ]# r! eas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
6 Z3 e3 Q* i; b( ~( u) p6 @6 z% Rimpose liquidation values.6 i+ X* Q6 c3 q; g& z
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In0 {5 I3 ]. Y- W
August, we said a credit shutdown was unlikely – we continue to hold that view.
& R& t( ~) u7 s5 Y5 M The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension* f! c: S- P, w2 w7 I
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets." p# s3 K" R2 ], f2 m* K- s( k
+ @8 `; M1 G& P, V YA look at credit markets5 Q7 s) `. ]: M3 N
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
# i# C2 |' e% s( F+ N# F; w& WSeptember. Non-financial investment grade is the new safe haven.# F$ V8 m) A$ u* s
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
$ ?! f0 ^: ]7 xthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
. R1 C% n" |4 ~. B2 N9 J& }billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have' d4 ?5 X0 p( w1 d* p
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade- V" _* Q* B3 R! a7 s
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
' b( Q* {; Q& B$ H# p5 b" Vpositive for the year-do-date, including high yield.+ D z. r) j5 R
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
5 p7 A4 t$ N( N7 _ v- Qfinding financing." c8 `+ o3 U* ^9 x `$ {: l \
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they5 R+ Q s( S" W
were subsequently repriced and placed. In the fall, there will be more deals.
3 L T2 V Y+ y$ [ Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and. M/ K# C3 o: P# i+ m2 c8 L: ^! s- k
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
8 z% w! I& W9 y+ ~0 a/ p: h7 R U7 lgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for- g& a: a: \) J& c2 l% |
bankruptcy, they already have debt financing in place.) ~3 |8 S/ ]. T2 k
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain5 T R5 L" h$ L+ q; j
today.+ `+ S8 v U, q$ w
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in. L- F% b1 V5 \9 T9 p
emerging markets have no problem with funding. |
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