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发表于 2011-9-17 13:16
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Current situation8 M4 H) z' `' b4 E% m& w# J) a8 f4 g
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long1 H/ V3 P) I: R3 S3 T9 t
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
8 X+ `. [0 U b$ @impose liquidation values.
; x0 i+ N6 v6 _: f$ F In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In) T; G4 s3 m' ^, a T4 F. q5 e0 @
August, we said a credit shutdown was unlikely – we continue to hold that view.
4 T) u/ ]; P3 ~1 |2 X! y) o The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension2 c2 j0 b; G5 H/ G7 A8 C6 K3 k
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets; W* H3 G6 L- D+ m$ p& ^
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in, p9 T V# ~, D
September. Non-financial investment grade is the new safe haven.
( |5 c5 N* O2 P$ S' K9 e High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
3 B, g# K2 n) K7 othen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
' ?9 x5 K" m7 C2 l) Ibillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
- V3 n' Z2 \ C1 u) M# p! g) z6 L8 taccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade. F: T" }0 R8 g9 E) l
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are" c# G+ {/ X6 }( d5 b4 k. b/ M7 [( E2 H
positive for the year-do-date, including high yield." I3 T( N: h0 `+ T
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble# @' o1 n8 V# m
finding financing.* E4 }8 ?4 A. p
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they/ A; j/ W, p9 U b+ p9 R- d
were subsequently repriced and placed. In the fall, there will be more deals.3 j/ o9 i, R. i0 V7 X+ b) Y; z
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and1 O- }+ ^( x/ d6 ]
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
7 C" c$ \: R( Q) ~. fgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
/ G E8 V" Y+ pbankruptcy, they already have debt financing in place.% x \, k _3 w: P
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain4 t0 y* P" c$ f! E
today.
( U6 D0 G9 Q8 [* M- ?' ? Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in$ m! t+ o9 Q5 H' d1 `+ A/ h" ?5 \
emerging markets have no problem with funding. |
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