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发表于 2011-9-17 13:16
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Current situation: X# O ]0 I8 X2 {) ?+ ^6 l' v' ?
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long) Z$ a+ y% H7 M# ^) j( h5 c/ t- Z
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may, b! V9 \+ r, S: s4 c
impose liquidation values.$ L8 k1 ], h( y; u
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
" S9 o6 O, B9 ?. {August, we said a credit shutdown was unlikely – we continue to hold that view.
' x' R$ @, N$ Y& K: u, V' z8 ^ The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension- A4 Q4 z% H& A8 W6 {' \
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 \0 v- Q1 k% y. Q& G7 o" w7 v0 f: `
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A look at credit markets% F2 f2 @7 P, T' `3 G1 M
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in" r5 ~5 C6 w* b6 R& e; \9 H* @ p
September. Non-financial investment grade is the new safe haven.
5 i1 @9 v! i0 _3 q* ?( O. B High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%2 e6 F. @; h8 `: E6 V4 \& \$ M6 o
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
2 v9 `) W" E- R# Tbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have3 ]& ], Z | J$ e
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
0 o+ {: c5 a( B! ^0 fCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
# r& c4 Z5 Q8 k2 q. }6 kpositive for the year-do-date, including high yield.& X& N, c8 F# m2 h' Y0 v6 m1 ?$ f
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
! O# x4 {, S& W0 l7 zfinding financing.6 V* R2 Q5 C- n' W9 o, L; F; o
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they1 C8 y* ]! a9 l+ Z1 x. {! |7 b
were subsequently repriced and placed. In the fall, there will be more deals.
, c; W3 B1 `4 q7 k/ h Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and) ^( L( ~/ [- T7 _4 z( ?" O
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
" U5 N. e0 A0 G& m! o/ i8 j+ c6 G. pgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
+ O8 P- y* A' ]. qbankruptcy, they already have debt financing in place.( k2 W1 x r8 o7 p- d6 a* X
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
# T$ h/ I3 R$ C$ \& Vtoday.
$ [+ y$ e# c6 @( Q1 X Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in4 g7 g5 y* \7 f1 G& h
emerging markets have no problem with funding. |
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