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发表于 2011-9-17 13:16
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Current situation
; j3 q e3 b0 j; [ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
: m7 ?! p8 S: `! k/ P% U% n: F* Gas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may0 d+ X+ ^: g' N! C
impose liquidation values.% O( | b. B0 C) D: n
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
2 a2 Q# _0 T) \4 O& R, \August, we said a credit shutdown was unlikely – we continue to hold that view.
1 u& ^% ]8 A8 G) l& K3 j5 W The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
1 C# h( T) L& a9 c% uscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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% z/ \4 i* F b# ^' g+ M, RA look at credit markets( S( W6 u k, _# C
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in# A P1 _; f: t7 Y& Q* x- u. ]4 q
September. Non-financial investment grade is the new safe haven.
5 u$ z$ j$ i+ p High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%9 O% d% g7 L& f1 H6 b) U. Q
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1: H, \ C! U- _. x
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have4 z, e/ B1 R! n0 m& h
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
! n+ z5 Z: i, V+ OCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
! W" Y% W6 G8 i$ kpositive for the year-do-date, including high yield.# \* R; n& R0 x7 b
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
- U d; n- A p r+ K1 M4 _finding financing.
( R: p4 O+ Y3 @ A Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
2 @& e8 x* t, jwere subsequently repriced and placed. In the fall, there will be more deals.' `$ k# `: y1 a% \2 {
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and G8 Z( t& p- O5 N
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
' ^2 q$ |0 H+ Q; J) l: Ugoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for# {7 @- j/ ]2 e7 v0 h4 U+ F+ p
bankruptcy, they already have debt financing in place.% v2 h g; Y {- _7 e4 y
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
( D8 M7 K& g+ s. _* S8 G5 R, gtoday.
0 ^( @1 _; F6 y# [+ |2 i Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
5 W0 U; R# ?: a( x( F& m* u+ Demerging markets have no problem with funding. |
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