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发表于 2011-9-17 13:16
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Current situation! T5 Z6 n: u4 j0 X+ w
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long, Y% r' z. B2 o {# Y; ~7 k& s
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
# s4 i7 B+ T r4 T* Ximpose liquidation values.
$ H. y' e) A6 f In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
9 H6 T. D0 u0 U4 p/ j3 e% M# dAugust, we said a credit shutdown was unlikely – we continue to hold that view.
8 l) o% V J7 o9 N, R p; G The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension* R4 q3 \4 C% H8 P1 P* d3 o1 E2 Y
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets9 u8 A. P6 O2 H6 r+ F0 G
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in! Z7 {: N/ |- l- U$ d& I8 C
September. Non-financial investment grade is the new safe haven.1 _2 ~# l9 W8 b9 F: V9 \1 a
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%! \ g9 y0 m. v: I% D
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
+ G8 I, a. P4 _6 p; M- Kbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have$ u$ |) B, ]% C# C
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
! R4 v3 n P# r9 ZCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
" R0 t% E; `. ?* x. Z5 a* Ipositive for the year-do-date, including high yield.
. \2 m' V W) ? Mortgages – There is no funding for new construction, but existing quality properties are having no trouble1 l0 E) |* O7 a( w
finding financing.5 {0 G \$ X: x4 u
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they0 f' F" [# h& I: M- V' y
were subsequently repriced and placed. In the fall, there will be more deals.
" \8 S0 k& d8 I* o* H F4 H* Q* A Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and. t& [ c. n. o# z6 p& g
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were4 X5 Q3 u7 s. x4 u- g8 u9 n- {& h
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for! Y; @+ A9 C( _% q$ `6 P6 N
bankruptcy, they already have debt financing in place.
- l5 u- e: n. y7 n. J& | European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
; F% A: M& _) C6 f, H# C9 \4 otoday.
1 p# e1 s# E* {- O# }3 w Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in1 w3 {5 N4 `% W( }* O
emerging markets have no problem with funding. |
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