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发表于 2011-9-17 13:16
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Current situation
/ n0 Y7 p3 e5 f0 s/ f1 O( R& ~ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
8 ^, x0 y& L/ C4 P, v+ W) O0 Sas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
+ N9 m! [ r8 Q/ |4 H! V2 v/ N5 x- Vimpose liquidation values.
$ l! Z* q( u) c In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
' e( a @+ U) C2 S9 C1 k# oAugust, we said a credit shutdown was unlikely – we continue to hold that view.
+ {! q7 l: W) {7 x' i The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
. f* M5 H1 K- O; _scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.3 i! N0 _- \ S% P! f; S
# @5 N- H4 O5 ~5 a) {A look at credit markets7 I' V2 J9 f' [$ u: k1 e0 f( g: F
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
: J/ M: E# u7 }6 zSeptember. Non-financial investment grade is the new safe haven." [/ n) y" @3 x" y, S
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
% b# D n% n0 O8 J% ]then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
; B, P* A, U& s/ u2 Lbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
/ u/ t" k% L3 n; ]. ~1 i9 e- R4 gaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade8 n- Z# N* v+ [; p b- H$ j; d9 N) \
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are# W+ _+ b9 ?' U3 O. v
positive for the year-do-date, including high yield.# W9 i* C8 t7 U4 u
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( Y r& x" {1 P+ K1 V
finding financing.- ^! x6 }' m, _9 u8 h- `9 }
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they0 p8 K$ E% R s
were subsequently repriced and placed. In the fall, there will be more deals.
7 y9 S. ~" e1 ` Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and' u% l! z; }# ]% o4 s3 ?
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were- K% Y7 T8 n/ K8 \1 o5 O+ S
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
; g" u! e' X0 abankruptcy, they already have debt financing in place.
4 `8 ~: i6 o0 D& C$ c European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain5 V* `) P6 Y, H8 t1 z* w4 W; U- ?
today.3 |" ?- B; `' a0 Z- S: P
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
3 @" P$ W* P: \3 S) B! `& @: e- Cemerging markets have no problem with funding. |
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