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发表于 2011-9-17 13:16
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Current situation
6 H3 z3 b2 [! w* ?) d5 e: V' v The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long& R4 U/ p' Q9 ~: ] N: Y( J
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
# M2 \! l: a: @7 [5 p0 Limpose liquidation values.8 j/ d. U" G. e9 N. h0 B! H; V
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In" x: x$ K; V1 S0 p! Q" J3 g
August, we said a credit shutdown was unlikely – we continue to hold that view.
; q6 V: Q) M. Q5 Z- J3 q1 t- D The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension. H! M! [# _7 B( ^5 a( M( ~
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.- @7 ^6 n _& p; |
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A look at credit markets3 s1 u' c& S8 Z4 o
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in4 q1 @: t" c/ J8 V% c' }! Q9 G) o
September. Non-financial investment grade is the new safe haven.
* G; I5 N b l4 c- d High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%$ J7 W5 G- h/ S5 L* `3 ^
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1: Y C) A/ J) O' f* s
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have, z' l- w3 [, ~/ W- g0 g! T7 P
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
. j% x, m, P) E+ jCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
3 \) Z. V7 e$ y3 o: R. Rpositive for the year-do-date, including high yield.
0 u) ~8 u- }6 |2 q" U$ i Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
; P( K# j# {, w" d; ?finding financing.$ n2 b# A9 b* y) l' {
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they, y, d, E, Q) c" L, H. h. s" w; p
were subsequently repriced and placed. In the fall, there will be more deals.. m; r0 F- W* X1 `0 @6 z$ `
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
" c d% t( d B) Z1 ^% F6 i# Cis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were2 T1 ~: b+ X0 C+ c9 r* K' f, ^
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
# h7 l" M2 w! K+ hbankruptcy, they already have debt financing in place.
C. k. @: y, ~ European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain( g& X" l E/ P$ B+ c+ L+ M9 W
today.
: _. M& H4 ]# K# d' l( `6 t Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in) [2 O8 i- c' S- _3 P w
emerging markets have no problem with funding. |
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