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发表于 2011-9-17 13:16
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Current situation
+ j- }9 ^% p2 L% \+ z0 T$ k The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long5 y$ r( P& _2 q9 y8 J
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may3 z4 s! h" z9 z* Y
impose liquidation values., j) Y) Q7 b3 S6 { M% K, C
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! T3 f/ C7 m7 O' t9 o: bAugust, we said a credit shutdown was unlikely – we continue to hold that view.' I) i0 x* E0 @5 d6 P$ o
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
- {# {# O# W. n( l0 cscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 t- v% b6 u4 @4 o7 l5 Q. D
, k$ [( c& E$ y$ @& F
A look at credit markets7 m& w+ x( r( r( v' V- W' q
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in. V! w% e" @- i" P
September. Non-financial investment grade is the new safe haven.
% o2 M+ q. Y* T/ ?9 a: X High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%7 x& U4 a, I0 J+ v" _
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $17 x. N' w7 o# v6 J
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have' k9 { h3 ]9 [, _: P/ S5 o% N
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade& N, U* v; L! Z; H( W8 b2 t
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are& C. t8 }1 b( @* B
positive for the year-do-date, including high yield.# C h! k$ E7 x$ `
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble- q) j! r; o7 h" Z! F! o
finding financing.' r6 \( \- }' |. C3 m4 p1 p1 F. l
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
2 r2 |# j" S" h9 Y- I! Xwere subsequently repriced and placed. In the fall, there will be more deals.$ Z, R' b4 I+ w1 s6 `
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
5 t$ L4 Z$ S# y8 r& r; X' ~" Z; r9 {is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were3 [) V: R; `/ k) b E3 i: \
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
: I3 {$ V4 }& v/ f4 I% O1 ?6 _bankruptcy, they already have debt financing in place.
6 ~+ O* q) x; z* g0 ?* F. W5 [+ E European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
: k. z7 K# t6 `! p1 Y: itoday.
- c Z6 B' r2 K" o0 Y Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in6 n. o/ c- p4 m, Y
emerging markets have no problem with funding. |
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