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发表于 2011-9-17 13:16
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Current situation/ E; i5 b7 Y' t: t* o3 N
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
0 N; Q8 p# _1 p& u1 E' vas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may% _& L! J: F$ l3 F
impose liquidation values.
4 A$ K' k3 W# B- q" G# p! `$ x$ ]3 e+ S In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In) W" |$ k$ M, j& H6 p+ n$ r& j, L
August, we said a credit shutdown was unlikely – we continue to hold that view.: [$ n( b5 Q* O) k' i' l$ T1 f0 F
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: N) m- z: E" G# n
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.% K% F7 W# q3 K" C, M( R! S; p. O' X
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A look at credit markets
+ w5 m) `2 a3 a5 ?4 g+ q, P Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
9 a# f' B' _( p8 h% rSeptember. Non-financial investment grade is the new safe haven.
) r7 c& X# e2 H+ g% [5 h High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
8 u0 i) k" a; l" {0 u2 J. @then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
4 y8 g( H0 ?8 f9 } F% e0 y `. jbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
& Y$ e& c! m! i: {. p+ R8 Z, K" M! taccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
3 ?; y* T) F8 V# O9 M! ZCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are" h" H8 ?( b( i" M! p
positive for the year-do-date, including high yield.
0 Z; n) K, {& |( b) v; \ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
; f: c; B, q7 R% c- [9 tfinding financing.! u: N: u# h3 R4 s
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
9 Y. [7 }9 a9 D; M" `# W% ~were subsequently repriced and placed. In the fall, there will be more deals.
5 q; J7 o* X# b; D$ M Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and: j- I& \" e1 e) V5 U6 D k
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
( G" U1 v+ I7 k2 T# V* k- Ygoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for$ T: _+ D5 h1 ]; K, ^
bankruptcy, they already have debt financing in place.: u; K7 @5 r. a8 O; c/ A
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain& N; S" |& e$ y+ ]1 y8 x
today.3 ?, x. i+ b7 `9 H- L' H
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
9 z# J8 U/ B6 b0 f# jemerging markets have no problem with funding. |
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