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发表于 2011-9-17 13:16
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Current situation+ Z- B0 k7 P) G! l
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
/ A: V& B( v! n' Xas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
5 r' w; R7 z/ T# ` a' Pimpose liquidation values.7 R- @8 ]/ K/ z
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In- h+ t& x9 p/ [0 B# F4 p; M6 `. D
August, we said a credit shutdown was unlikely – we continue to hold that view.
* t# m9 x1 t7 N& N! k% C The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
" j: g: x, R) Hscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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: F6 u4 L$ }2 E. SA look at credit markets/ }( t! M" }0 F% D) o6 {
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& L: z4 I! I9 L' ESeptember. Non-financial investment grade is the new safe haven.; ^( n( n4 X" I7 W1 b$ H1 q$ w
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%. W0 H( _5 G: t. r% ^
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
1 P; O* {, Y" _. Jbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have$ c) k0 h% N s' g0 A! ~
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade7 v$ [- D" W1 l1 h3 e# r2 l6 n
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are& s" R& g& H/ R" }8 m$ Q
positive for the year-do-date, including high yield.
) F7 \$ ^) q' t- Q+ d. L Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
$ M3 V8 }' U% U8 M# {7 H+ I0 Z1 m7 b& o' Ofinding financing.6 `1 U" G2 X/ \* q6 E, g' ?8 d
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they8 W% ~! r& [! | j: [& U
were subsequently repriced and placed. In the fall, there will be more deals.
4 O7 r( T3 |/ Z+ u, \( P& v% m Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
' H# {. H( g) y" B( q6 qis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
- F" ?1 [" W) M0 E- U( pgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
! Z& e" w( b0 K7 ?: y% \3 }$ rbankruptcy, they already have debt financing in place., {0 o% x0 k' h% m5 _% ]
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain; @$ U" ? ?1 l$ z2 i/ m
today.
3 N7 c) K5 y* A6 c6 o- r) k Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in |$ h$ `( q; X( v
emerging markets have no problem with funding. |
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