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发表于 2011-9-17 13:16
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Current situation
9 ~( e" c" |( s- [1 Z$ k The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
; z8 {/ Y* k' C8 C+ j* C% kas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may) \& Q6 b4 h" H
impose liquidation values.
/ V$ `/ q% X4 o" @ In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In0 Z( c) \, [! q
August, we said a credit shutdown was unlikely – we continue to hold that view.
& q8 {% x: p0 o4 E" t+ H The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension' j: A& g) d/ Q) T2 e1 z: O
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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( ]: o) i' y3 a- G+ kA look at credit markets+ G8 m6 o" `9 g/ u& D
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
9 J( z7 O" C& w. d" iSeptember. Non-financial investment grade is the new safe haven.' T1 l! H8 `, g& m! j! e1 e8 b% ?
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%: k$ T3 J! g% m8 A9 _& e. M. U2 E
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
& ] ~# n% P! t7 ^" j+ Abillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have; t9 Z- b/ x1 m1 e& T! Z
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
! f ~. n$ u; I& \2 A; o3 \! tCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
% P' [+ j j. b6 ]* m+ ^1 ]positive for the year-do-date, including high yield.; i( c U' W7 L$ s! F5 w- I
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble9 R$ w' ~* A0 E/ c
finding financing.
2 r0 l6 a4 j$ T Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
: O+ t. y, g8 r% u* gwere subsequently repriced and placed. In the fall, there will be more deals.
. T/ d! [4 m/ i$ t Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and7 c+ Z- f. F5 X% M, U
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were5 _2 j' [. E/ Q( a5 m |
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
2 Z! L( q+ [* Hbankruptcy, they already have debt financing in place.
3 Z( g" @( s$ x& F2 w European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain9 d, N. C) B3 S& {4 f1 L
today.* s# r: H. U6 Z$ j# T, P; |
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in( y8 t* Y+ u) o. s- {5 o
emerging markets have no problem with funding. |
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