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发表于 2011-9-17 13:16
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Current situation8 D1 k3 f/ M% l/ H- g) B
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
: {* l7 l! e% m/ D0 h1 Was funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
( \+ L1 b, a- h; e* k* A& iimpose liquidation values./ I, K# w0 n5 [) u; g# {6 m
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In, m8 @! k( e( G: |+ L; Z
August, we said a credit shutdown was unlikely – we continue to hold that view.$ F6 z; k( N3 e" C1 E
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension# d/ S* K" l) P
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
# a2 J1 v% I. { Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
8 k$ @; i7 c2 U( g3 D; M- }, V* DSeptember. Non-financial investment grade is the new safe haven.
& I/ @/ z7 B+ f. J( ^ High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%. R9 x! _; b1 f- a
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1: [" D8 v6 `2 f1 ~# o: Y
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have9 o+ ?! v! }' E2 g+ M k
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade/ q: E @5 ~2 R) v' b( n
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
; }1 n' c8 `* {! m2 I, |7 fpositive for the year-do-date, including high yield.* `4 \! U: E5 O) o' I# t/ M
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( ~/ V8 L; z) L2 F6 g( F) r
finding financing./ ^! l6 U3 X1 Z5 `
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they. |" o2 ]6 v. m3 z( P
were subsequently repriced and placed. In the fall, there will be more deals.
4 h V! |: q0 ~ {; S9 m, E Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
- k: R4 t) H L6 V/ R1 sis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ b" K2 t" j: O' G* D# E* S
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
% ~& {# l G( B. U8 z+ Hbankruptcy, they already have debt financing in place.3 m! B# Q. _8 r2 X o3 f2 B, X
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain% }- K; N8 ]) l8 x; `
today.- E6 d) O- t* W$ e0 ?* L5 P
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in- P0 A; U& [( e( F! b
emerging markets have no problem with funding. |
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