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发表于 2011-9-17 13:16
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Current situation
- N( K7 ~4 i0 F& Z) `4 l) J& x/ A2 ? The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
% }: f% d5 X; R( t# j ras funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
% `/ K4 B3 m9 C! P3 B4 Y w+ u& Fimpose liquidation values.
$ J1 t0 l3 K: P' T! G3 p In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In+ G5 {8 W9 p7 f- I' e
August, we said a credit shutdown was unlikely – we continue to hold that view.6 v& {1 }4 ?8 S
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension# ~/ E& R# f" H( Y2 j; @
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets. r- @% v+ M- N5 W5 @3 w
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A look at credit markets( @7 ~ [% U! |& x" \
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in& y9 v: z% k3 k' s/ x% d
September. Non-financial investment grade is the new safe haven.# q1 E( U" ], f: c, I
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
( E, U% M5 a& ?' _then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $10 B1 a& w* q. w2 T; h
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
3 D5 N/ b9 J, w: x5 r- faccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade" d9 R4 |! c' N
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are6 a9 G2 \# R9 [# A/ I7 e
positive for the year-do-date, including high yield.8 T6 d% Y7 @- \2 z
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( L, |$ |1 B5 o8 G9 P
finding financing.
" l) V# s, `( @& z1 ~ Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
, X, A0 `/ U2 x) {. Vwere subsequently repriced and placed. In the fall, there will be more deals.
$ T. u H! }$ @! X# Q) x* f8 R Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and6 g2 J6 g( {" S) B( f# H
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were; q% `' @. _- M7 d" w% y. ^
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
5 A7 B7 P+ k$ O4 Wbankruptcy, they already have debt financing in place., n. u" f& D- u* l7 R2 Q: r( t
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain( W; z4 s; `0 z" J- I
today.
q# S0 S$ z5 U Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
6 ~" d: b! a2 F4 \7 f. ?( Aemerging markets have no problem with funding. |
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