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发表于 2011-9-17 13:16
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Current situation" C9 b: c5 X# K
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long+ D0 t8 o N8 h' d
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
0 @+ l& G: L1 himpose liquidation values.# U% }' a! G/ W4 U7 i" Z1 i
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
8 d4 d$ H& F5 F- b4 |1 MAugust, we said a credit shutdown was unlikely – we continue to hold that view.
! q6 |0 G* q. z/ [! s The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension4 V$ K Z- c n& T: V9 ^
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.( c O4 \! U; B e" C9 U1 j2 {5 ]
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A look at credit markets
8 k$ y2 |0 X M/ P% i2 l Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
6 B, v k' h# h* o, zSeptember. Non-financial investment grade is the new safe haven.
, [' c% o9 m+ Y" A High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
! Z' n- ]3 S- A5 H! h& x, \then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
3 w1 G$ [2 i Z }' g; ibillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
! y/ x8 C% u& |access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade4 [5 N6 i) G, y1 y
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are' f1 _/ j7 k; l6 f: o
positive for the year-do-date, including high yield.% |6 a5 w8 {0 i8 \
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
2 K$ D5 u1 t( a6 ]; Z) j" ofinding financing.2 ~1 B6 V4 t5 Z( M
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
9 U Z% a' Q, h9 twere subsequently repriced and placed. In the fall, there will be more deals.* t) D/ m9 n" v4 x9 s2 Z/ j
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
! v9 C/ A3 |- ~* N! r0 b- wis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were7 X! E# k0 Y) u* Y( H
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
& T o5 Y) m" k- T6 Kbankruptcy, they already have debt financing in place./ ?" l$ _$ w7 b$ p% R4 L
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" z V. C! f8 Z0 Ptoday.# x; l9 x# G5 G- O. {: y
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
5 f9 p3 ~2 O4 I v" f0 C$ Femerging markets have no problem with funding. |
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