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发表于 2011-9-17 13:16
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Current situation3 @7 m- u8 N: B/ I) M
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
& H+ O3 K1 U3 F6 Gas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
; r; A3 ^- q8 h' j9 j! iimpose liquidation values.
- i7 @( X* B# T& ^% G% J In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
' z! f3 k8 `5 rAugust, we said a credit shutdown was unlikely – we continue to hold that view.- ?1 r! D- r9 c8 m. G
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
0 D0 x* j3 D0 S9 rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 G' @; ]7 D4 i! D4 \! e6 R. [/ d4 N
1 ]8 Y) _9 S3 m! V' CA look at credit markets
% n( s3 n( Q1 _1 y# w( O2 h1 v Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in0 m& T) T0 b$ O3 I
September. Non-financial investment grade is the new safe haven.8 ^3 O: v8 L$ B
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
) w/ C9 i& W$ M+ w7 d8 w; ?; I) {then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
; b3 g' W$ ?6 s& c! R+ ^4 z$ e8 xbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
- t3 B" y7 ?3 U# jaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
+ o8 X$ v; e6 wCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are0 `4 n! e& v5 i9 h& l3 u8 r
positive for the year-do-date, including high yield.
! n5 N R' E" t* z# x; d7 C: U( U Mortgages – There is no funding for new construction, but existing quality properties are having no trouble! F0 R( ^! g& e. R% G' \! h
finding financing.
7 T3 l9 V7 g( F$ `3 \2 J Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they0 h/ |$ m7 j5 {& E( N7 \* }' ~
were subsequently repriced and placed. In the fall, there will be more deals.
# Q0 K' k. C e+ L2 a, \ Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
: ^- P' Y! i' o$ iis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were3 l7 F& E4 |) ~
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
' y5 v7 U( n: Z8 Obankruptcy, they already have debt financing in place.* \# R1 X9 w1 I1 |2 d1 x: |
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain& r- D$ b' M* |- }* T
today.* @' d' | h: X! |7 q- `0 Q9 j
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in4 B1 j, t, d, f
emerging markets have no problem with funding. |
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