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发表于 2011-9-17 13:16
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Current situation
# [7 U- W3 s: z; U; S+ R8 ] The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
0 X- r3 x% G+ G) Q3 U: s6 b6 v# H! yas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may+ ~, M& ~& U# s9 s& X. U7 ~
impose liquidation values.1 S) ]1 P) e/ C! ^
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
/ v0 K- q* m" ?- TAugust, we said a credit shutdown was unlikely – we continue to hold that view.2 }- o8 g6 @/ a1 g
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension% S9 Z( E; z# u0 n( ~5 a, ~# o
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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. b Y6 n5 n: n& [' c8 {4 mA look at credit markets
1 K& _4 C9 }$ R Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in% h. V! p% U( r% [- r2 B" p
September. Non-financial investment grade is the new safe haven.$ N' a) E! w) x! B7 E1 h+ A$ ?
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%& [( r& H+ }" l) X/ ]7 `' z0 M
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
8 ~2 z0 ~' f4 Q) ]$ V7 R: Ebillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have3 B" Q) _+ l; t5 ~3 H5 d3 Q" i2 E+ O
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
0 O: ~$ o1 V" i4 i# N% P! DCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
2 E* K( m9 X( y) R3 h C( M& Mpositive for the year-do-date, including high yield.
; V2 S Q5 k4 e7 y8 l$ ^6 t Mortgages – There is no funding for new construction, but existing quality properties are having no trouble- v1 U" Q* p y: I# `1 t( ?5 Y
finding financing.( v2 F" J# |0 I* b( z O- Y+ B
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they+ H$ l y0 C$ b
were subsequently repriced and placed. In the fall, there will be more deals.3 h& x5 a `& K0 B# r
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
! a7 g$ `8 N! Qis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
' a6 i; N: n4 V% V% ?+ ^going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
& n5 y4 y9 Y" A N9 dbankruptcy, they already have debt financing in place. l" s& O! f _& W2 F
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain7 M. m j0 W' R- Y, S
today.
2 ] w. }3 f* B9 V Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in2 l$ i' |+ v, C5 M
emerging markets have no problem with funding. |
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