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发表于 2011-9-17 13:16
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Current situation: a4 M- C, l7 M3 T9 p5 R
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
& ]0 Y9 [/ L5 J' ^+ L, E1 las funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
, h. g2 v2 ~6 o( t/ ?: z) j- [impose liquidation values.
. ^ A) _3 A5 H In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 K' b: n7 _* yAugust, we said a credit shutdown was unlikely – we continue to hold that view./ r+ Q {7 |8 k: ~8 V
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
# D, }* O1 y$ l+ }7 rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.- F% T5 p: m5 z( j' x4 ?/ D
. D7 |7 {" d3 b: l
A look at credit markets2 i/ |" ^0 y4 W- ?
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
. L% @ ]1 ]2 N; N3 xSeptember. Non-financial investment grade is the new safe haven.; \9 V+ Y* j3 s* Y# ]' e
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%; c; |' r' |; ^- J R! Z7 m: z
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
- W% X, }; Z( p. Y$ Q0 M R* obillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have- b: I5 @8 d6 i0 Z
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
5 |2 R" Y- i6 _9 f$ CCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
" J/ P( `2 D4 |positive for the year-do-date, including high yield.
& z2 C0 [5 m. d: B; N Mortgages – There is no funding for new construction, but existing quality properties are having no trouble, s0 a5 r# W3 u; ^8 F
finding financing.% ]* {. a' `! `$ I8 S) e8 E
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
0 }7 {8 h% y$ t! g5 C4 Iwere subsequently repriced and placed. In the fall, there will be more deals.6 I/ N/ }& ]9 d8 ^1 o
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and9 e- {# G" `4 s8 J: C# {5 d
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were6 A2 U5 v' J+ D5 ~0 s" r/ A) P
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for: a& k. N1 z8 c0 y1 ^8 Y
bankruptcy, they already have debt financing in place.# ~8 v1 ~% O* C8 ~5 u( V$ ]
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
5 u9 B W! d+ S4 a8 Vtoday." m/ P- A$ y3 u: ]) Z
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in# y0 i- \ ~& L* t6 n
emerging markets have no problem with funding. |
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