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发表于 2011-9-17 13:16
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Current situation' E T N9 u! a, l0 I; J7 e7 @
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long. F G; k a) l ~0 J2 N7 I
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may3 |) }8 r. c" C d* O- m
impose liquidation values.
{4 `" v y' t$ u& h In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In0 h/ K2 `2 o; N
August, we said a credit shutdown was unlikely – we continue to hold that view.
8 d$ A, ~- F( L4 n- g2 x4 W# { The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension3 P/ j; |3 t7 ?- a
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 o3 g: q6 S/ x- q9 G# [8 R- ]
& t' ` K+ `0 {A look at credit markets
5 j7 z C# r! a! J Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
9 R6 A8 x1 @ U. z/ zSeptember. Non-financial investment grade is the new safe haven.
4 s, d# n! ?& k+ `7 {. V! C High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%' M- w, i Y Y& t$ F! i
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1 }8 m$ B' D' ?( S6 x6 h' b* W
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have9 d: D: T- {5 |' T S3 H
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
% F, P9 g" I1 I' L) x5 q6 J* RCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
6 Q/ Y t; R2 l* O2 ?- tpositive for the year-do-date, including high yield.- L0 y/ I6 l. N$ U
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
7 u. n7 |0 \; s) s( {) |" ~2 Vfinding financing.( c; T) s. x( k! Y
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they- _. o3 h. l! w9 g9 Q2 I
were subsequently repriced and placed. In the fall, there will be more deals.
- v$ D( `$ [! m' X6 f4 _ Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and6 j2 N! ?8 o( S
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were7 x! r, F$ K8 \% H+ B* s
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
( c$ u" k. a+ `bankruptcy, they already have debt financing in place.3 B/ p6 S/ x8 O2 H9 [
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain' H) U8 p9 w1 l* `
today.
+ x" N ~7 E8 M& f Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in& M; F8 {4 W; w0 i1 S4 S
emerging markets have no problem with funding. |
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