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发表于 2011-9-17 13:16
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Current situation& n3 l8 E: \; ^
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
( a# L& T: o; V, q6 ?as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may* r' t: K1 I/ z! a
impose liquidation values.& d- Z& b' p6 ?4 G7 @. i* F
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In, a# h' g0 N8 B% l" B8 p# G) Y: {
August, we said a credit shutdown was unlikely – we continue to hold that view.
* `- ~4 l" T+ t# z1 h2 l The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension' K7 G0 a) ?3 K- ]/ }0 T2 r/ [6 `
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.& W; ~4 M6 G1 q' E1 {$ ^
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A look at credit markets
3 v2 H: \7 Z5 A. k Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
- B: r0 p" j" B1 {, \: P4 O _September. Non-financial investment grade is the new safe haven.
# C. v; i2 T9 M3 [ High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%5 r, ?, V8 e1 [3 o7 ^
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
. P0 m* B4 i( E) ubillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
0 v. a0 T M3 q; m( l* `0 z' T; Caccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
9 u$ m: A( y |8 n8 RCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are, K/ D! Y# a$ |7 A5 j7 k; g! W
positive for the year-do-date, including high yield.
, w* y! W+ t9 @0 [6 ], \9 [ K' ^ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
8 y! z6 q- x8 [* {. k$ {0 ffinding financing./ |% Y- U6 ~1 D2 g
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they! g' V* c i/ Q9 s0 ~- c
were subsequently repriced and placed. In the fall, there will be more deals.
5 ]9 j! x# {; `: b- ? Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and& L: z1 Z* X ?3 a' J
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
- i0 i- O3 Q5 Z9 w& {3 Tgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for; g6 w# V( G: |
bankruptcy, they already have debt financing in place.
6 W9 X) k; W* T' W! [% X" D& ]' } European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain- b, T9 B: f- b- L7 J5 ]# B
today.
" W3 l1 H4 F4 C0 f. S7 J Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in: x; E4 ?) I6 v3 K2 p; p/ v# s0 a
emerging markets have no problem with funding. |
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