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发表于 2011-9-17 13:16
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Current situation
* \8 m9 ^/ U U4 W& Y The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long/ i" i( o' y/ s9 H4 t5 Z
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may6 z6 Y R, Q* c6 J
impose liquidation values.: h2 K m4 p# @9 i. X6 u
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In$ l# ?# p2 x$ W" I
August, we said a credit shutdown was unlikely – we continue to hold that view.; s- n" [" m, z+ }/ i# g6 Y
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
' i9 F" h, b) T& m2 o7 Cscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.) j0 ]: q3 C+ n* |0 g- e+ T! o
) M5 ?: u& p- |' R( X6 n; Y; RA look at credit markets
+ z0 x( ^# q0 F! f, P Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in0 B# z- Q1 h7 t! A& [) L, ?
September. Non-financial investment grade is the new safe haven." Z+ X" L e8 A2 V/ v7 O2 S9 H- W, s
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%: _0 ?5 n# c" t) Y
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
! G C0 T% Q) T; d! u4 |billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have9 `# }6 {6 I3 c. w8 a
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
/ I; r0 u# w, {6 q0 HCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
' w8 ~# y( Q3 q: A' b, qpositive for the year-do-date, including high yield.6 Q" X# v1 U* `& s& q9 d# [" J9 [
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
* M# l8 n$ o3 l& Tfinding financing.
7 Q3 q7 C( E$ s: H9 E! l Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they* y* Z4 }) B# K: K' h
were subsequently repriced and placed. In the fall, there will be more deals.5 D5 o: a' g8 C# u4 ^$ x- Z2 s% \
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
0 F: X8 A- p% g! m7 x6 w7 jis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
% \! g0 D/ E" W4 X: i: C# ggoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 a; m3 a3 g5 b
bankruptcy, they already have debt financing in place.
: @4 D0 R8 v9 x/ V/ | European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
, ~* ]; h2 ~- c9 i! gtoday.
$ L# \7 ~! h N K Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
; A( t5 Y0 a" u9 Y! T+ f$ O, j+ temerging markets have no problem with funding. |
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