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发表于 2011-9-17 13:16
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Current situation$ W& e; g+ | a8 X0 a
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
. K+ p; o# i' {% m+ ]3 _as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
: I& h3 Y+ ]0 J+ ], C' y7 @3 m" nimpose liquidation values.
" h) @( [, i8 t& P In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In& ]- g2 G0 x" o" w; G! f
August, we said a credit shutdown was unlikely – we continue to hold that view.
9 o9 b# d5 N: o The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension' C. q' |# s& F1 v
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
% S0 X( ~% w d! x8 Q4 t* u, j
9 q) F L$ O0 O3 L) Z- A" CA look at credit markets- _" H% U C8 P0 l: O
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
( t7 o; A$ C+ X$ Y! U- w* lSeptember. Non-financial investment grade is the new safe haven.4 W" R* `8 H0 L: f }$ N# N# P
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
) [( w; q: d+ \, _then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
# K5 @) O0 ~0 b" V% Cbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
2 [5 b: [; m+ I( W& jaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade g# s; W9 ]- m
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
2 `1 d3 O M# {& P5 [positive for the year-do-date, including high yield.
+ D4 I; N" d2 P2 J( q; {4 w7 B Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
: `( j: @: n7 B2 gfinding financing.
- ^4 q: u5 A2 {' ^ Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
! Q+ y. j% F5 a& A2 @: kwere subsequently repriced and placed. In the fall, there will be more deals.
) J0 F: N6 T! ~, y I0 S" Z* ?& k Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
% H; @* W) Z5 c! W: K e5 _' pis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were) ^: h6 L) q% A$ o% [
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
/ ^# j5 u! e% \/ z" Hbankruptcy, they already have debt financing in place.
' {% {2 Y. n( d; \ European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
6 W4 n$ y$ {0 u) stoday.
* B* U# P; h4 @ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
; a9 k6 `/ \$ qemerging markets have no problem with funding. |
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