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发表于 2011-9-17 13:16
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Current situation
0 e9 N# A3 Z. B/ x7 G The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
% P1 I" v4 }9 O n ^: z& ]as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
; m/ x5 L& L& Y# uimpose liquidation values.& F0 M+ m. d, {
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
# q8 l! Z2 a7 dAugust, we said a credit shutdown was unlikely – we continue to hold that view.7 J# A4 T5 V- I5 F2 p
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: D7 t# P+ |$ y; n, l6 f* X* R2 z
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.' z$ A( e$ | x& g
- K& q) t3 s# \* S- e) q! B) |( VA look at credit markets( j" \: G8 \2 i4 g3 D# D
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in, g3 p! [ X5 o8 l1 u2 ]
September. Non-financial investment grade is the new safe haven.
! I% F' ~) o$ ^" b |7 x2 E High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
% ~2 d- F; d" q% S6 Qthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
. s% v' Q" I7 Nbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have r ^0 e; r. }* B. S# C: ^
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* a* G5 W4 C' d; _) `# y* m
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are7 @2 J* Y& |( a% N$ `
positive for the year-do-date, including high yield.) I1 n5 D% [5 c+ |( N- N; h& _
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble* h0 A% |) w9 A4 p
finding financing.
5 V) [# ]" ^( U5 R4 G* G l* U Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they! c! k! g% y9 Z/ S* G8 L& A
were subsequently repriced and placed. In the fall, there will be more deals.
- y, y# u4 Z, O, c! w) @ z! t! s+ F Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
o2 m2 F3 O+ T0 r2 {! I, a1 Tis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
( L- ?5 x7 W6 A* N0 ]7 C8 ~( \going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for! D$ c. g. k5 m' ~& ~
bankruptcy, they already have debt financing in place.- c8 t( U* ?+ e2 k
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain1 H, k `' y4 r( a( b% X+ \& z
today.7 T% a* q: b! u+ c* U
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in7 Q8 u3 _) y3 O& E: s
emerging markets have no problem with funding. |
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