 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation- i2 R( S5 M$ f4 e
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long! e6 C$ M2 m# b4 {
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
. e- |- E. q* vimpose liquidation values. V' i* }' V4 W7 T: `. ^
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In- K, {$ t1 P# F; s e' _; v
August, we said a credit shutdown was unlikely – we continue to hold that view.2 K6 d* T4 |1 t9 R
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
. x7 H8 T' S( X0 W; Rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 [7 D, u8 Q* z5 x% h: Y0 D% `
" }' w) F8 b) Q6 e- F
A look at credit markets! W. f4 f' v7 p, g% e2 P
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
, v6 s% q' Q1 [% D/ WSeptember. Non-financial investment grade is the new safe haven.6 {1 {2 \9 ?! c" ?+ {* X
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
$ A( N# q# p! `2 d. [* zthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
9 U( U' z, g% w- A: o; Mbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
* n c' q& ]4 T! {0 K1 v& baccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
/ u: B. x* v1 Y/ m! i) P" T' dCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
+ S- Y5 @" ?) r) t7 E" Dpositive for the year-do-date, including high yield.
! u2 x' \& ~, H; P7 |. } Mortgages – There is no funding for new construction, but existing quality properties are having no trouble3 V9 K' u- y+ \. C
finding financing.! w* c6 `8 Q' A: n
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
4 H) ?4 F- o7 Xwere subsequently repriced and placed. In the fall, there will be more deals.
b, n' [2 `- V8 X0 P0 y2 A- w9 K Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and+ j' N) @* }$ O/ ^. u
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were2 L0 y+ Y3 a+ h7 M$ j
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for/ s* Y1 D& g+ i: h
bankruptcy, they already have debt financing in place.
! ]; ?7 C1 o+ y @& E4 F European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain# g! j6 ^7 i! i3 r) e }
today.1 D" l2 A! ^; H, R/ A
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in; l( H. ?& M/ x a8 d7 Q% O
emerging markets have no problem with funding. |
|