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发表于 2011-9-17 13:16
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Current situation2 | Y: v: G# V" ^
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
4 l: Z+ U# ]* d% j! [7 H/ s1 ?: ]as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may7 H# T3 \$ X, g% g: w
impose liquidation values.
- r" j! i9 ~; b; Q$ b5 T In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In6 P |" L6 M1 K, I; w
August, we said a credit shutdown was unlikely – we continue to hold that view.
! p' E% F; P2 n; `' ? The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension. f g7 R, q, w& n
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
3 K% u' F0 W( X- x) s4 _ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
" V$ c( E7 I# p5 l0 C% NSeptember. Non-financial investment grade is the new safe haven.$ o+ } m2 F2 z$ y, Z0 P6 q4 M) H8 V: H
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%6 Y, `; o/ w( s/ X, S) Z
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1' N# y; @: Z( u0 @+ G
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have3 x9 m) ~9 J$ S9 T
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
; C% f* w9 Y7 c9 @0 ^" O0 H/ O7 JCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are& I8 D* k# u+ v8 }0 C+ S( c
positive for the year-do-date, including high yield./ ]: n4 W) @' ^0 \ r& ?+ H
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
0 F5 E# M6 @9 p: d- [# K( r$ Dfinding financing.
- H- Q% G+ {& ^- N) Z0 k9 S Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
* B* ]4 H! A, w6 H: f9 R9 ]were subsequently repriced and placed. In the fall, there will be more deals.0 J2 C1 Y' A% A% I/ C, O
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and2 ^+ ]( @" \, Q8 e! @
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ m% y9 O0 e; v% r. G# m* r- X' O) G
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
0 z4 C! P* d! b+ mbankruptcy, they already have debt financing in place.
) v- l+ Q0 k# W# {# P R _9 A European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
& q3 L6 ~. K; J0 w& U' Q7 O- h% htoday.
1 h7 U0 R, W6 J. M. ] Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
" C) W+ Y! z$ Z) wemerging markets have no problem with funding. |
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