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发表于 2011-9-17 13:16
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Current situation3 {9 Q7 L! E. g7 ?4 n
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long h! `3 K9 p0 S( n0 U1 @3 S8 R5 ?& ^
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
1 _! m4 I, ~/ h \# H- ~- T& Vimpose liquidation values.) c. W6 Q9 D; C' j
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 m3 H" \" z# R6 J9 ?& i% W" |' IAugust, we said a credit shutdown was unlikely – we continue to hold that view.3 `1 q/ v) D/ e
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
" u' d# F- \! u+ \ C3 Rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
" T. a6 R9 [+ ~* j- _' v8 _ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in: b, t L" Q7 L# @& Z8 o
September. Non-financial investment grade is the new safe haven.; E" P5 ^8 v4 l. ^" F
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%. j9 U+ J( z; `9 [ P
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
2 r+ k# Y4 W9 o) S6 O e$ V& Hbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
. k7 G3 a" Q1 [access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
# |, m( n9 G& L$ X- {3 vCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are6 C5 }) J0 E( E# R4 a7 v
positive for the year-do-date, including high yield.
- O" r; G) Z q9 Q2 ^ z2 f Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
/ n; c. O. ~( B9 k* w% Gfinding financing.
+ R9 [" l, j2 P6 z2 c3 B4 I$ r Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they9 R5 ]) ^8 q5 u( s! B
were subsequently repriced and placed. In the fall, there will be more deals.
- a* E0 H k. R; K5 N* C: d- Q+ s Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and- t1 d5 L) W/ L0 e: j9 ?9 I! f
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were' G7 b2 C6 K0 F4 v6 B
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for9 d0 }+ }! q0 j) Z
bankruptcy, they already have debt financing in place.1 J# V% R9 {' G
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
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 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
1 }8 |* u! K7 T7 F3 C7 Semerging markets have no problem with funding. |
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