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发表于 2011-9-17 13:16
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Current situation
2 [, e# L% u. [1 O# | The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
1 \6 l' i$ c! N* K/ C5 xas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
- f! d) ^$ f; J3 s1 vimpose liquidation values.7 \: s3 f% T3 ]' d3 E' f U* R
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In, l9 a: L! p7 C. t
August, we said a credit shutdown was unlikely – we continue to hold that view.
& V5 k9 P' b: x U. w The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension! M) y9 {; @' T" ^& ^
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.0 G1 P0 x$ ?3 a. X0 m
3 z' O/ X7 D Z/ T+ y6 DA look at credit markets
3 x" Y7 M U$ ^) o# {1 M Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in9 R; _' i. n! H3 P# ^' W7 f
September. Non-financial investment grade is the new safe haven.
1 Q$ n) k2 F# d, v; _* d6 d High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%/ |3 r2 e- v, |6 ]; m) a. T
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
' y/ E% m8 E0 z2 l% w0 Pbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have9 a! H. A) i& \( I
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade ?( A! M' M. o' y' [4 c) s; m8 L3 m
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are" S4 ]# ?' P4 R
positive for the year-do-date, including high yield.0 q, f* X% L7 p1 u
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
7 v0 S) ~' u. S* G5 ifinding financing.) p( X0 o- D& d4 g. P
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: q# Q- D V* s) G% t+ H( x
were subsequently repriced and placed. In the fall, there will be more deals.% G T* W, W) j( F/ q0 [+ z
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and) U+ {$ m: o/ y. S/ U/ [
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
6 o8 C5 W' @0 ^# x1 I) ~going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for0 a; [2 b" b1 G4 V
bankruptcy, they already have debt financing in place.
. R% W4 g7 `% u$ T6 R. w# H European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" l" _ }# o$ Ztoday.
{% H5 E, W: J; z: n J Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
& n1 N* Q) K: P3 Memerging markets have no problem with funding. |
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