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发表于 2011-9-17 13:16
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Current situation* @7 H7 d g2 r! g% t
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long0 u8 T$ ~+ u+ l9 s# ^
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
6 I7 T0 q8 J6 |' e, |' ~5 ]) wimpose liquidation values.
1 J% ]' ~# c# r i. y% j In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
' ]/ e3 _5 x. J: rAugust, we said a credit shutdown was unlikely – we continue to hold that view.- Z4 f d( h& h; `& N# u
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
, X6 B K1 \5 P) P7 F2 Hscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
# [( G% K$ b/ \3 w Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in! H5 T {% U0 i( L1 h" Z2 D
September. Non-financial investment grade is the new safe haven., i- \' Q. W+ q8 B K1 }* ?* h9 C
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%* K# B2 t" @, T) N" Y% c
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1 Z% C E" W' T1 s$ v& `: h0 W6 T
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
' t9 K. @) K f& v4 _* {access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade4 @$ w, a+ S0 l# ?0 S
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
' P9 W6 h8 P2 g" c3 O5 Vpositive for the year-do-date, including high yield.
* i$ F7 Q* X U7 u. H0 \ Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
& F7 O4 q: ^. x% ~2 ^+ Lfinding financing.+ }# y8 F& [5 Q* ~3 q
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
% X4 W1 M$ Y" Qwere subsequently repriced and placed. In the fall, there will be more deals.
# g; O; i$ w3 P- z6 ]6 {% b Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and- F3 m/ J" _9 F0 l* ?
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were( g3 K/ F: ~( f+ R4 x' | E0 ?
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for6 f! N( j( V6 O3 X2 l# q* e
bankruptcy, they already have debt financing in place.2 |, x( O# x+ K$ @; d
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain8 J5 g, W5 k" @: i2 _
today.
* K, k/ @4 U" f L: ^ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in0 T& ]" w, ~; L. x' X8 n
emerging markets have no problem with funding. |
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