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发表于 2011-9-17 13:16
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Current situation$ a/ s+ L* r) }' g* H" J( B! R
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
4 p. `6 R) w" u. C8 y% \5 }. vas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
6 ]: o+ C' `* e/ K4 y' N6 O9 dimpose liquidation values.
( U( Y3 Y5 s- m j* e8 c- J In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In' O1 _: P4 H- P- o* \
August, we said a credit shutdown was unlikely – we continue to hold that view.
4 ~* i" \ f0 q4 G The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension, U, b# l1 G% h9 X
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets" h+ a3 T P& v1 [# e& H% M
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
( i; Q8 e) [0 d# B! C' c5 \6 ySeptember. Non-financial investment grade is the new safe haven.' ~4 W- w/ l1 r1 z, B" A
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%4 S: Q+ }6 z! s R% A$ G
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
& o% l. c2 y$ X. Ebillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have7 y" k- {4 S) @4 N, k7 [ `% c
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade0 M) d8 f% D, R. i2 z2 f+ @# j
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are5 S0 @- O) |$ m# P
positive for the year-do-date, including high yield.
, l2 d& C6 O( r1 E9 H- o Mortgages – There is no funding for new construction, but existing quality properties are having no trouble" `. @6 I4 L0 w
finding financing.
& h2 m% m$ y8 b# ?7 i Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
& c, [; w. E2 a$ c( y1 y% n/ Swere subsequently repriced and placed. In the fall, there will be more deals.
0 {- D/ l" t. y: H! I" z( ? Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and, j4 b7 ?' s. r* c
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were* {7 L# b) i2 N( K
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
: w% u0 P$ h8 ?" h$ Bbankruptcy, they already have debt financing in place.( k$ ^( U2 e# H+ G! t* C9 ?& S
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
! o, |) p) b( B4 o- V; ~. R& ktoday.
/ T2 r& F9 [5 f F8 i. w$ P# Z Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in2 f: ?3 M6 Z1 z' S
emerging markets have no problem with funding. |
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