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发表于 2011-9-17 13:16
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Current situation. Q2 W5 @4 K7 W1 O; Z
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
, ^9 i: H; B- w5 ?- mas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may$ {/ ~: |/ i4 F, ~" O# ?) X, }; W# f
impose liquidation values.- a9 Q/ L$ X5 O! r
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
% n7 x& S, x8 E' @+ R9 ]August, we said a credit shutdown was unlikely – we continue to hold that view.( U1 i9 n% Q* W9 ^2 C
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension* i3 i1 a. N3 C3 E) m& D3 n
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets- u4 W5 t$ ^6 u5 p. J
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
2 O9 T) D1 U# R- r- T3 DSeptember. Non-financial investment grade is the new safe haven.. P" [% i4 @4 W4 t) D* e5 w
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%+ {0 d3 p1 ^; h) s/ C: c7 G
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
5 a, i3 I+ h7 P- F" }billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
# E# b$ e+ v2 e saccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
. r- T6 Q+ ]( z* L% R8 r2 G1 p( OCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are* c3 W( m& s* Z7 K; w
positive for the year-do-date, including high yield.
- J8 {, ~% ~$ v, T0 v Mortgages – There is no funding for new construction, but existing quality properties are having no trouble. i5 ]* [$ s3 ^+ M' t
finding financing.
4 y6 p" f, J2 ^- X# Y% n Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they. S; Q1 |1 V- g0 `& \' {5 G
were subsequently repriced and placed. In the fall, there will be more deals.2 K" j" T8 Y+ q8 j
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
# ]) s+ ?" N6 z! c* yis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were2 `3 H, t7 y8 W1 y/ A4 n, H- d% {/ s
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for6 A, U1 a6 u$ \* C1 c6 q
bankruptcy, they already have debt financing in place.
! x0 L; w; p: } European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 B' u1 @$ J* atoday.
) F |: a3 O; v& _ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
* F0 L. y" ?! |, [, Yemerging markets have no problem with funding. |
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