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发表于 2011-9-17 13:16
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Current situation# W; W2 ^- h) m" G
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long. S' H/ H) X0 n4 ?( J6 P3 N
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may$ Y4 b7 P, l4 r4 A
impose liquidation values.
/ ^6 H8 x E8 c; ? In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In- X% X( X _/ u
August, we said a credit shutdown was unlikely – we continue to hold that view.
8 S' _& `1 Y) U. @- n* J The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension% q4 I. X" L4 h
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.. o5 y$ R U) x3 w9 B
- R" k T& |, F4 B xA look at credit markets' W2 h( `" Z0 v% l9 g& Q) m/ M
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
% p: ^; L: L( B0 U1 M/ ASeptember. Non-financial investment grade is the new safe haven.
|; o0 @& z0 n High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
' ?4 k& L# { [" C3 d% dthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
. y# h7 w2 Z! e& [billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have" O7 Y- W4 z7 j' |
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade1 ?* }, {$ h# i
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
! L1 _) P. Q; i4 e2 g7 J) C Y# h) jpositive for the year-do-date, including high yield.+ m: U% f K6 v
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
8 K% I8 h' A1 n* d" Bfinding financing., ~3 L+ h: ^ ~5 K8 Q: i% r
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
! }; H2 D$ {8 vwere subsequently repriced and placed. In the fall, there will be more deals.
- z5 \! D6 ^/ W+ t+ _8 \ S Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and& W: V& m4 y( J2 d- s& s
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ P9 N2 U5 v4 c' o8 o
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 Y9 ~/ V" N6 @0 h" k
bankruptcy, they already have debt financing in place.; S8 j* D+ y* q. [- k$ d+ }7 o' g1 `
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
% _: Q" }4 e! Gtoday.1 U. ]4 D2 L! m& o! m5 s
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in5 n: R8 ]- Q3 q8 [
emerging markets have no problem with funding. |
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