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发表于 2011-9-17 13:16
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Current situation) N9 f4 U$ Z9 ]7 e; Q. u% |
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
R; q$ b7 y# Q c* v( J- j# Oas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
) W. h' ^% \' f6 y, o- simpose liquidation values.
' |* \- D7 I% P X6 p# P' _1 ?; g In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
7 s4 U3 B- R- F' e) I. c# U5 mAugust, we said a credit shutdown was unlikely – we continue to hold that view.! z; p! ~8 p6 @
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension, Y+ ?- A. h) k9 [' ]3 `
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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1 f5 e9 `' J9 h! z, ]& A& T3 ]4 `A look at credit markets
1 f- l8 f2 W3 N* e+ _ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
; ^9 M% T# e9 T8 [September. Non-financial investment grade is the new safe haven.
+ p3 t$ u3 Y! M& L2 t m# L/ ? High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) ~( A+ G/ s/ \# K% i" |, u
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1! Q/ }. X% Y- M, b7 }% S1 ?' `
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have) e2 v3 H9 B# J' [$ p9 S
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade. h: t9 @+ n" k- l" l; p
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
$ q' b" ~$ n( K. C9 k4 Ypositive for the year-do-date, including high yield.! z5 {) I% J" i8 I
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble0 ?8 y5 Q" @; b6 G1 Z4 R$ V
finding financing.
7 x4 t' \( q+ [" U. t c Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
7 V2 M9 H9 W' t3 s0 ywere subsequently repriced and placed. In the fall, there will be more deals.
7 Y4 W8 t) M1 z0 z Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
}- {; W+ A+ \! w2 y4 uis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were/ v% P3 x5 g( e$ O, r4 ~
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
8 a, H, X4 r- r3 ^3 v9 ubankruptcy, they already have debt financing in place.3 g9 G8 @& d$ g1 g7 j) I
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 v3 h# y- R7 X+ l8 ]+ Ytoday.
5 [1 y" v3 ]8 u0 T Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in! z9 r* Z5 I5 D" \ b1 i5 @8 W
emerging markets have no problem with funding. |
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