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发表于 2011-9-17 13:16
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Current situation
D/ p# B- p1 E& t3 p' U The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long% C& i: T; W9 T' m
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
3 w; A$ M2 \6 vimpose liquidation values.0 P( u3 C( w& u9 h- k
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
8 f3 m" }6 Q; f" T3 bAugust, we said a credit shutdown was unlikely – we continue to hold that view.8 x, A1 b4 u$ b- z# X3 x
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension! n; m' L4 G7 ^/ c @
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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2 I$ Y& k( s* T0 f7 C3 k. CA look at credit markets
$ V) D( A5 U' {2 S3 ?7 M; E Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
: p( B1 K0 ^! wSeptember. Non-financial investment grade is the new safe haven.
* R( _/ u) Q G7 K n3 F4 A High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%' ?8 B+ B+ m9 U8 R$ l: R9 }; N
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1! m7 H* W8 v* W1 N# L
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
' i T: i; ]0 u8 [0 ?% Naccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade7 @- I5 T& L- S" f. ?/ W) }) p
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are0 v! Z8 x" \2 J8 Q& d! o
positive for the year-do-date, including high yield.) l: b% B6 [6 Y
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
, N! Z8 a% w) U, L! R7 ~$ y7 i- ^; bfinding financing.
0 q' c7 G& ]4 G" R, l5 p Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they9 t' v' k. F8 J, q) l h; [
were subsequently repriced and placed. In the fall, there will be more deals., `% c, E9 U/ H" j$ j
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
/ U+ p9 L" \5 `9 L$ E! w) p+ F1 o* U( Cis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ n1 u9 C& r2 J2 v8 B$ W& G. q
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
" ^; Y# r. ]% S4 n8 Tbankruptcy, they already have debt financing in place.
2 w" l7 i% ~/ H% G, m1 `; P; L2 C& { European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" J) \! Z* f$ M0 v! \7 Ntoday.. H) F0 P- k3 z: F% S
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
4 S" I5 Z9 C2 ~. B- |0 u- xemerging markets have no problem with funding. |
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