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发表于 2011-9-17 13:16
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Current situation
f9 {, C. x; b! Y u! u) y2 ` The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
" {5 k" b+ _0 d9 L$ l! ]4 Vas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
# Z! B0 x2 ^6 _6 J! {; rimpose liquidation values.
, Z! D8 Q; u8 o% k( v/ S, u In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In9 i9 U' B# q4 J/ H5 L
August, we said a credit shutdown was unlikely – we continue to hold that view.! I( x( W3 |' L2 K6 T
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension6 o( w, C4 o9 c* l! |3 r; l. h: m8 W
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.5 Y/ f9 H7 @1 B$ j% s
* O# y9 E" A2 O1 BA look at credit markets5 ^/ s/ C/ i7 R5 _2 I# q) N5 a8 ~
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
) B- s3 Y+ b' u/ _/ CSeptember. Non-financial investment grade is the new safe haven.- G- c0 Y) d5 I. x% R% t2 i. a% H
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%& P! v; K8 |+ n7 _$ E2 n
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
$ k9 I0 F" @) C6 f0 r2 V' L( cbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
' S4 E1 f, _. R: Y# @* z' Vaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
9 F7 e1 ]. r5 w# pCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
( U* D; i/ d6 [, r* h- Jpositive for the year-do-date, including high yield.
1 f3 B0 O9 [" v4 E- R' Z Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
`; K: s' @5 ^2 N B) k2 nfinding financing.
5 x2 }) h0 e! S1 L% | Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they/ ~/ k2 O# D6 d2 P
were subsequently repriced and placed. In the fall, there will be more deals.
! J0 K! u, f" Q2 d) o6 {: v/ Q$ v Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and2 z5 d2 k. L) f' J
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
/ n6 i7 k! p2 O' igoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
- ?4 _* _+ ~' i2 Ybankruptcy, they already have debt financing in place.
# C% S7 ^1 S( H2 o European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 z; Q, D( @# N' h; p' _ htoday.
! L9 t- a8 S- y Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in) i& P, g& p( {- L, o. M7 V
emerging markets have no problem with funding. |
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