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发表于 2011-9-17 13:16
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Current situation' f4 B+ L5 C. }& X1 @+ J2 d
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
7 x/ a0 N6 T' W' A+ Gas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
7 U$ G$ {; y3 \. a oimpose liquidation values.
A& U( U% \9 u0 S" _' v+ W. r6 z In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
- N+ A3 g/ ]$ G3 vAugust, we said a credit shutdown was unlikely – we continue to hold that view.6 N% |1 s; n1 n* E5 u3 R
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
8 [ W3 P, r+ Oscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 x) e( Q1 }7 ^' }
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A look at credit markets
+ c3 `& C- C6 U8 Y Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
- n8 N& ~3 L2 _, c3 b0 c1 tSeptember. Non-financial investment grade is the new safe haven. [- d3 L8 t4 |
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
- H% {+ {5 ?4 @) M/ nthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
# d$ S0 N+ c8 w. T; K X/ X1 G1 U4 qbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have: l* r1 \# Z* |4 ?. s5 h
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade& [! e" b2 t( J, x2 I
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
1 @3 B1 X' w3 P% y. W- Gpositive for the year-do-date, including high yield.$ x9 s# L! V9 C3 Q
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
! O" M* ^5 o- b; h q. X0 cfinding financing.- {8 Y' f$ ~- O
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
; s/ z5 e4 Y( f4 Lwere subsequently repriced and placed. In the fall, there will be more deals. _5 C1 m! {% J
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and# `+ U' q& ~% K) y* W
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were8 J% n# J# z. s$ M4 \. _
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for: O# s( z: R) e
bankruptcy, they already have debt financing in place. m% M3 ~5 ?' D6 E' X4 h
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
3 a9 G) D L( A; J! s" p. ?7 L0 qtoday.
( E6 ]# S r2 D0 H+ J9 d% G3 _ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
7 q/ B' S* r( S7 c9 E$ f2 a/ Femerging markets have no problem with funding. |
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