 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
! J' @$ c! P- B$ ~& c The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long) ?, R& i6 l1 E4 W1 U \: \1 P
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
+ {! H- m+ ?/ |* |6 E" D! z& pimpose liquidation values.! p% a( b) F( Y" _& c% r2 W
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
% I* I- g9 p$ B4 Z" W- pAugust, we said a credit shutdown was unlikely – we continue to hold that view.
5 E) I6 g' | s) ~8 T$ G3 A$ ? The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension _6 x& E/ l% n3 T
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
& C4 [$ V2 E' u9 U5 C. Y: a1 X' g3 E9 H5 b8 C
A look at credit markets
0 q4 @8 v. M& |+ H3 ~ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
7 k9 y9 ]( X" g+ J' ^7 ~0 ?+ gSeptember. Non-financial investment grade is the new safe haven.1 X' l1 Z! U2 E( M
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
# t9 [! n- y) w# J. O1 Zthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
- f0 v: r; j) k( n8 Qbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
7 W& p: H3 m. q8 Waccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
; x" o7 b. T' j( lCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
3 v, s, E6 g$ T5 L5 S* ]0 T) x0 npositive for the year-do-date, including high yield./ t# K3 Y) Q0 Y8 V. x4 G7 Y* @7 a
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
2 D/ n3 R& A" y8 ^! {% rfinding financing.
e( ^. s2 G: ^8 ^' { Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they" J6 `5 e: Z9 o8 Y( e& Z
were subsequently repriced and placed. In the fall, there will be more deals.( V; C" o, b- d: |' W
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
- q* g6 ]& n7 I2 R4 R1 _) ^4 w; v8 ~6 lis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were5 [) z0 K" g7 @# _, E: ]
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for" d: q$ _1 V7 M' r" K0 Z3 G. Z, l
bankruptcy, they already have debt financing in place.' V( k3 U( N& y8 M: e X
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain3 U9 V5 G3 ?2 O7 A! g+ A: X5 c
today.
# o. f( n/ J2 |7 n6 M0 R! Z Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in" \0 r& u; J2 ~
emerging markets have no problem with funding. |
|