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发表于 2011-9-17 13:16
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Current situation: k- B* |% I1 E2 G& e; x
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long- f/ w, \: B+ ?" _
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may$ d. q: ^) H$ T* D6 Z! n3 d; ^
impose liquidation values.
3 E5 r, c" i. ^5 z In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In5 {7 y* j; r6 t/ Q- o
August, we said a credit shutdown was unlikely – we continue to hold that view.; \" S; E" X- _7 x( M8 J: r* S! U6 J& f
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: z: T1 H( D* c5 o: `7 E
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.6 N0 U9 u5 S/ \! @' ^) V; S
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A look at credit markets
8 k# O' E, N% A. k- f1 t Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in9 @$ [+ G2 ~4 v
September. Non-financial investment grade is the new safe haven.- k1 ~) R% _+ B# s6 ^. n+ D
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
" b! _, h/ Q0 D+ dthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $16 n5 V; _+ c. I/ X# R1 h
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
, F. m- @. i% y+ m# N! B' Maccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade- \, {0 l) f; T2 ^- h
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are5 `5 R/ g( n; z6 \. J
positive for the year-do-date, including high yield.6 D% ?1 Q( ]! |) t, x
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
& Q+ s5 T* g# Ffinding financing.1 g7 @5 X( R3 f8 S
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they7 X! Y `% V5 c4 k7 Y/ b8 f9 ~" m! b
were subsequently repriced and placed. In the fall, there will be more deals.
7 X4 _# e! t7 R& V E$ v2 E( B: c+ @: H Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and0 N" n, p/ B* p% X4 E( W
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) Y* @ V" r$ p" d; [going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
1 a2 S# m* B0 |5 Jbankruptcy, they already have debt financing in place.
$ V" j( c+ z0 {9 Y) R European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
; R! j) h% {# R# i$ i. ~today.1 `% T) [7 `/ q) C' V _) r3 I
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
* N: T: D4 S1 ]% {( y% y' pemerging markets have no problem with funding. |
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