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发表于 2011-9-17 13:16
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Current situation
+ N* j+ }" t6 R9 R2 @8 h2 V, [$ [ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long8 B5 q5 D) j9 u/ L( A1 ~4 u7 S
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may. ~/ x0 D4 U1 Y" @, [
impose liquidation values.
- A' E$ O4 ^/ n3 p9 y In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
0 \- Z T1 w$ _4 q: [2 G3 tAugust, we said a credit shutdown was unlikely – we continue to hold that view.
7 G: }6 X" ~/ d The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
2 I* |& _. |. h; \& b( O1 [& Ascrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.0 k& }" L/ v2 u4 A4 ~7 d
0 a+ E6 s3 b* E# j! k" MA look at credit markets% U" M. X" g1 _8 j
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
7 W7 b. w- J) F9 q8 cSeptember. Non-financial investment grade is the new safe haven.
1 U% b& ^, h2 D! d High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%% N0 b* j$ N" y% g3 z) x; v9 h
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
$ ` j5 P$ G0 c1 ^# ^billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
% C9 p3 G" Z+ X2 V* Paccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade% b5 Z( [2 s! l" ^- F
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are; e( q; p4 W1 \' L
positive for the year-do-date, including high yield.; y% h) H* C* e4 `3 I
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
; d0 s5 x: J! U2 k$ Nfinding financing.
; {! O. R8 k. A5 d+ k) s5 i Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
( J2 C8 V/ n$ B% T& bwere subsequently repriced and placed. In the fall, there will be more deals.
* i5 V4 P) U- k H, o3 f- d Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
W/ q; t$ L! t! h5 A# V9 V- v8 Vis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ g$ g* G" q& X( w. |5 |
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
- d# U/ s$ y+ E) A6 [bankruptcy, they already have debt financing in place.) a; D0 w: B c5 N9 y
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
$ E# y7 c5 U5 c& Xtoday.
# Y I$ e! D8 D* @1 f Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
5 F8 T+ Q# r3 D. R+ bemerging markets have no problem with funding. |
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