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发表于 2011-9-17 13:16
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Current situation! Y" c0 B- ?. |" h6 m. g2 Z
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long* u2 Y- Q- h6 k: N0 C7 O( t' [9 k/ q
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may& j6 Z" a; [2 c
impose liquidation values.
4 U# P+ | Y- c7 [& Y6 z/ C( U In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In: W7 m+ Y6 P% [+ `' l7 [
August, we said a credit shutdown was unlikely – we continue to hold that view.
' V9 H2 L \+ m, ?- B The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
& _- p8 Y' T8 Rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
' I: p9 O. G5 ?7 ]1 a9 m
; M$ ~1 \: P9 {) B6 jA look at credit markets- a+ [; l% ^: `& {) D4 c
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
: x) P {! [( h) e9 N) y6 v F' A! N: }September. Non-financial investment grade is the new safe haven.
" l$ X2 u4 z2 A High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) c4 J( o7 W2 I$ ^9 a
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $18 a) Y% g+ } E
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have- a; `* ^3 a1 V, t
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade0 h% h3 Y# e" k1 _ g. o3 x9 X
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are& s' f) m6 A) h' S
positive for the year-do-date, including high yield.
3 m! _' {' p! r# x Mortgages – There is no funding for new construction, but existing quality properties are having no trouble; w. B; i9 W+ v0 e! c
finding financing.0 E2 Y) K' M7 U/ Z* X" o
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they1 f& j9 V) t$ H6 E! ?0 P7 n
were subsequently repriced and placed. In the fall, there will be more deals.
{ e, y8 i2 ^' J Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and4 T5 T$ a# [2 t, T
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
* Q8 m. { p( }7 {& f( f) Ngoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
$ z4 l% S( O& Mbankruptcy, they already have debt financing in place.3 Q n& ?: y( t$ D
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
2 O* T8 k4 N; B: y/ ~today.6 C7 N$ Q' r( \7 m7 P
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
L$ @4 y; X+ I# D1 G% X! `emerging markets have no problem with funding. |
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