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发表于 2011-9-17 13:16
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Current situation6 k; D; a2 g& a* O% h \
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long1 D$ c3 b: s4 ` n
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may- P+ o" N/ L; |0 M3 q% x5 J
impose liquidation values.
7 v( ?- _. G7 X' E! T In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 Z' L! { K2 M5 p& ^: h$ YAugust, we said a credit shutdown was unlikely – we continue to hold that view.
9 Q) B* j% x. ?3 k$ J The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
5 `- p+ R! U/ l4 S }scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
' r0 }) @5 S9 {" N( X8 U6 U Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in3 I t! e7 g! ?1 O
September. Non-financial investment grade is the new safe haven.+ ~" i2 ]3 n) V! \ k! J) ?
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
$ Q. U4 {1 N' s `5 B) m; Ethen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1# c) C' z& @+ ]* k: }6 k, o) e
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
& r# t0 \& W# K% n3 L( }1 O) Yaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* O: i) L! S" ^+ ^' Z3 |" S- d1 K
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are% u! r3 I- D! G0 w% _
positive for the year-do-date, including high yield. I0 `( M- L1 G) E; E0 O L9 D
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
* L6 \1 u, E" V4 k9 Q5 Ifinding financing.
$ _& w, M! {4 I$ e: j7 D Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they; Q5 q6 ]3 t4 }4 }+ s' Y% r
were subsequently repriced and placed. In the fall, there will be more deals.2 Q/ m t# i" a( i' G0 q
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and+ X# T8 d c8 [& Y
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
/ Q, Q, M$ J3 M0 d& {' cgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
/ o& a# l7 \: V2 {bankruptcy, they already have debt financing in place.
/ B7 w8 `1 |1 a0 H# F European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain- W& h6 q. Q6 S1 J+ d
today.. X# G- g+ z( n' u6 C' h
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in9 d6 C" x5 I0 c3 ]4 Z7 u) |
emerging markets have no problem with funding. |
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