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发表于 2011-9-17 13:16
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Current situation) f( q! n7 [+ @6 S
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long. b7 J( G8 A7 Q: {% ]; L5 M
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may$ @, V1 j/ U; N9 P( s1 l4 H$ F
impose liquidation values.7 r* N; H8 a* L/ M- ~' k W# `3 L
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In4 V& w- N8 V' s6 b
August, we said a credit shutdown was unlikely – we continue to hold that view.
' Y, Q, ?. N4 A' l1 S; O The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
9 m h0 V0 |# P) [+ ?( e1 Vscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.: [/ V2 d. \' t/ L0 w
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A look at credit markets. {% y# M5 \# j* l) i$ Z
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
, H9 S- H2 b9 uSeptember. Non-financial investment grade is the new safe haven.- T4 d2 O- r5 y/ p
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
5 S" ]. S3 l* V1 d" P# o5 k0 P9 ?then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1: i+ p0 Q7 X. G0 p2 O9 S* p6 w9 x
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
$ ~/ x3 ^3 ]) E' aaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
9 A0 [* S7 ^+ Z* W8 {CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are2 g0 Y2 ]& l6 a% c; ? g+ _- I
positive for the year-do-date, including high yield.5 r4 t" f+ q4 g, L- {( J/ [, c
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble4 o. j3 S$ z: J1 S
finding financing.* l" f0 c' V( b) j" ?
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
3 W. b, g5 a0 [. O3 x. owere subsequently repriced and placed. In the fall, there will be more deals.
4 A7 u+ e# {, p! Q/ c t Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and' {- U4 ]" \5 M) ]1 R. Y
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
3 |) {9 B4 s2 ^3 _going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for i7 q2 v0 M7 Q+ P6 k. _
bankruptcy, they already have debt financing in place.
' t. q" P. n9 b% E( n European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain% f( {4 e6 @8 p% a0 L" T6 {
today.* c! L* J' a1 C6 y) u, J
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
4 W5 s0 t7 Z% Nemerging markets have no problem with funding. |
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