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发表于 2011-9-17 13:16
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Current situation2 `" @* t7 y7 x( @) e- G
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long A8 F* [" M4 v& s$ ]
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
) w X$ Z0 W$ V: Dimpose liquidation values., a, m: i& M: n# m' |
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In5 }5 ~: ~0 j7 |+ i. x- ~
August, we said a credit shutdown was unlikely – we continue to hold that view.
1 s8 a. _2 U) J8 x- f The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
8 \$ X+ c# ^) n& lscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.: E0 y! s% F8 |- _6 Y' U
; _1 e0 g6 u0 }! OA look at credit markets
- m1 C8 @( d% y! U Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in0 W5 ?; P3 @* x5 z! c! s
September. Non-financial investment grade is the new safe haven.) p9 K T+ j4 J8 O/ ?. b
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%5 p# ^8 N0 n8 Z( `7 K- J( p
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
% C8 K! @. _/ d) Obillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
5 K" m4 c$ R7 f) v: L3 f* ]. Raccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
/ i, D8 }9 \# p2 L6 H# d/ K4 tCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
7 G( j( I3 c" o$ Ypositive for the year-do-date, including high yield.0 N* `( y( q7 ]: y
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble. Q; a6 ]! N. N% Q c/ |* [9 N, w' x
finding financing.; r& Z+ l! p9 \5 A o/ r
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they4 s' G. [" |* o% I7 S8 {$ {
were subsequently repriced and placed. In the fall, there will be more deals.5 a" W; \+ N& l0 c/ E5 b; e: B# e4 i
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
) ^, z& z) J5 X$ Uis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were. x( h# l J' N
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
7 b6 Y7 m9 s" B: ~. i" Vbankruptcy, they already have debt financing in place.% @: m, a8 [: H
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
1 D9 `/ J0 p3 M4 L' H8 b0 Etoday.; d0 X' d% r) M/ k& ~/ v
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
% f7 c+ b9 L% [emerging markets have no problem with funding. |
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