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发表于 2011-9-17 13:16
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Current situation
7 o: P- l" u1 ]! }. c6 r The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long: D7 |% d$ ?- p( z1 ^
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
$ F) H' q$ \0 Z1 T: dimpose liquidation values.% [4 L4 Q: k: \% w0 ` G( K
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! B* C d# q) z4 M! wAugust, we said a credit shutdown was unlikely – we continue to hold that view.3 V$ H. _. E6 ~$ ~3 c% t
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: `+ H3 t: u' O9 E+ m- U+ @
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets., m+ R- S" P- ^0 O: T; n; Q6 a
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A look at credit markets/ e* Y6 W0 V) z, r4 a$ L3 o
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
* v D, A: M9 O- Z( z3 D- gSeptember. Non-financial investment grade is the new safe haven.9 Q/ L) R' ~& _
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%+ w J. r1 D @6 X. ]
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $11 h- o k! E4 s
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have4 t* \3 _4 y: |' R! Y+ a: M8 |
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
9 l/ W7 b$ _6 P UCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
# `% z/ R- c, E T' W% Wpositive for the year-do-date, including high yield.
, \4 A1 O( B5 \& c( C( } Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
5 ^7 }9 @5 ^2 k' \8 k* q7 Gfinding financing.
9 ^2 R% W3 {0 ~ Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
& z! i5 Z7 J3 w% w) w9 h) ]0 Y# cwere subsequently repriced and placed. In the fall, there will be more deals.
/ t# l" z& t# S8 K; t* B Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
. e3 T& V1 ^5 a7 E$ M& k) Eis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ e9 Q! q" s h
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for6 ?6 X) h i+ g% p1 v- ~
bankruptcy, they already have debt financing in place.
9 L6 E5 y# f g4 T, Y European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
* F. Q9 Y6 s& k1 F8 B# p- ftoday.0 ^. a9 E" W4 d2 W
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in; a) W& L6 k0 H* q$ j; C
emerging markets have no problem with funding. |
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