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发表于 2011-9-17 13:16
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Current situation% i/ a U3 X# ?3 {
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
) h3 e [. M. Q, U& I* q6 r+ Has funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
5 T' a5 d- B3 e/ ximpose liquidation values.
2 j) m: Z+ v0 I( e9 O! U3 X( q: X In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In5 t& V3 G2 ^. A
August, we said a credit shutdown was unlikely – we continue to hold that view.
$ V% \" O+ F! j The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension) d2 B8 N7 }3 B) J( C g% n" Z! h0 o1 m
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.: f$ P3 w6 S1 n/ w3 j" m
7 k! q a1 z5 J
A look at credit markets# N8 {. z$ a- d2 q
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
$ U$ q E* P! k; _ Y: h6 OSeptember. Non-financial investment grade is the new safe haven.) C5 E/ L0 `1 ]
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%7 }, y* C6 P7 N% |% s9 n5 E& y
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1$ Y% q! F( U' E) f* Z
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
0 V& h }6 Q3 }& c& ~access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
( l$ |! ?3 t0 o; N5 u$ h* ~CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are }7 J1 a4 w% B. e- g8 R. B! d% [8 Z
positive for the year-do-date, including high yield.
1 s/ M3 p0 A6 x% @3 A Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
* @7 c0 R) s. e+ Pfinding financing.
! V9 i) b2 P- v8 ~/ g Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
* ?3 Y3 L3 Y O- vwere subsequently repriced and placed. In the fall, there will be more deals.
2 G6 n, g4 c- Q6 _( N Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and. j: m4 V0 u. K( \. T: n
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
; ~$ e: n1 \) q, R# qgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for6 K& P8 o* V- _4 y+ l+ l
bankruptcy, they already have debt financing in place.- b5 o w4 L% P' S( t1 W
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain* r1 s/ \4 v- T4 Q
today.+ l3 x5 L6 ^4 J5 d3 C
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
+ d/ j. X+ Z3 D0 l' d6 ]2 eemerging markets have no problem with funding. |
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