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发表于 2011-9-17 13:16
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Current situation' D' `8 X; J8 a6 e' g0 F5 B: o! z
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
1 A9 T J4 h$ `8 kas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
. x# \1 I+ n2 W2 Q I9 E/ w& x- Qimpose liquidation values.
" Q3 m5 }5 B7 o, n5 H In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
3 T! Q5 `4 n& \August, we said a credit shutdown was unlikely – we continue to hold that view.) [/ P! D* e8 o) g
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
5 E' d M; d, A7 j, i* P H2 q( bscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.+ l7 s1 K8 h9 @6 a! ]
7 \+ k7 _: A7 y$ lA look at credit markets3 Q, L/ B, U5 ]/ D
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in) l( t4 \/ s' z) K1 C9 `7 h8 `5 j
September. Non-financial investment grade is the new safe haven.
' ?5 U6 h4 q7 \- }# \0 |, @; ^ High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%/ V8 p0 |4 C* G6 K* w' @
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $11 `$ n) ^0 |! B. d4 O
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
4 g0 Y S9 h" ?5 v. j! i( Uaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
6 \/ U6 b/ j1 [9 L. }CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
5 z K6 s! h* X, J9 U O Fpositive for the year-do-date, including high yield.9 _" D# v5 S7 `/ r1 y: F
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble4 _9 k" g( b: C
finding financing.) i5 o( b& ~+ n1 @
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they0 K1 |( ]' c' b1 ~
were subsequently repriced and placed. In the fall, there will be more deals.
; N$ W, L( i8 F, f% D8 P Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and% K, V+ y# M$ C$ r- y4 h. m m
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ Q! _* D8 t1 X& S5 D* ~4 g
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for; R7 Y. p5 z4 E2 a! n# k
bankruptcy, they already have debt financing in place.: T# F! z# r: [" }1 c) Y
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
3 {3 P# n( A! u. rtoday.' D8 T: a+ g% H" W6 K7 G& L4 K
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in; U) q7 w* x; e# I- d
emerging markets have no problem with funding. |
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