 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
4 B! e6 ^+ ?! ~, H The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
2 P& D3 ?9 K) d2 fas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
) g& y- C; _7 h6 b# [& P' q" d* oimpose liquidation values.9 F1 R- Q$ K1 b& W" x+ F' b( V4 f
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
( h2 w1 A% \0 C1 }5 |7 \August, we said a credit shutdown was unlikely – we continue to hold that view.
- M: E1 x& K- i, d5 i7 x( X, m The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
" r. `% Q0 B. ^/ H% k: v K& `scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.+ U" A1 B0 e- I% U! v
- u$ c5 g$ O8 k! v" Z) ?, Z% kA look at credit markets* V9 a- D# E- H4 l% D d* C
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& x; U) M8 P0 v; p6 `September. Non-financial investment grade is the new safe haven.* I+ ]1 _1 v+ f
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
( m" z r$ U0 U& A5 mthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
+ M r9 e7 ?& P3 z6 Tbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
0 D+ g3 B! u9 X; h+ haccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade% K% _5 w! t% y5 m
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
3 n ^3 Z0 m6 B2 t. R% upositive for the year-do-date, including high yield.
& B5 _5 F+ _% `- `( m4 |" ~ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
, I% k4 f& }+ q6 E, @finding financing.
2 U' {! _+ z& m' [/ k' W: M! T0 S/ D6 s7 a Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
0 @, ^2 m) `. d4 [* l% vwere subsequently repriced and placed. In the fall, there will be more deals.; E9 B$ S7 H1 N
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and' A- \2 s0 _6 N0 `. p, v# @% z
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were! z$ t0 Y+ i, X& u3 \
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
; b9 `& H& Y7 ~! S ?8 {bankruptcy, they already have debt financing in place.# P+ Q% X; |6 r
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
/ k; a" z5 a" d/ G" P7 itoday.# [" c2 e7 |1 M: I3 S
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in. S! W* i! c! l
emerging markets have no problem with funding. |
|