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发表于 2011-9-17 13:16
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Current situation, j) _3 F8 O6 m* p' r7 L! H
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long" Z8 n, h0 v @, \) n
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may; `0 Q; c; \$ F: x& X' ~
impose liquidation values.1 h7 P: W5 d# R! E- D9 w
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
" {/ D' @0 `' bAugust, we said a credit shutdown was unlikely – we continue to hold that view.
5 M9 w! C2 A0 Q# q! g The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
, g* [5 y' t# P( @( Yscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets7 Z- `: \) H2 B0 s- D, ~& x- ^
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in* h9 M- @7 A: Q; ]
September. Non-financial investment grade is the new safe haven.
: g% [8 m0 d7 t# l/ @" D0 Y% d High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
) o3 I) ]: ?( p( d1 k# Kthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $10 F1 D3 b+ A# x6 x- }2 H# T
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have2 {' x9 X; C. v! B) B" K6 A5 q
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
4 V- Y; y! I! q. k; F8 ZCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
- l. @4 o3 [& Tpositive for the year-do-date, including high yield.% D- X. o6 I) `& R
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble9 W9 t6 f# `1 n
finding financing.
; X5 w8 R9 _% h8 ^# e! h Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
# G6 b& @4 U5 T1 q8 n4 j- Fwere subsequently repriced and placed. In the fall, there will be more deals.4 h) _( ]( e5 ^5 P. _
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and# e' [+ A' O2 K3 q$ P; h6 E
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
, a9 r3 E4 S- F0 g- N Q% Ugoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for0 j$ ^& t' y, t0 H4 L8 E
bankruptcy, they already have debt financing in place.+ C1 X" ^5 c+ @% A
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain l( K! |+ ]1 u" J7 L/ ~! e0 L
today.
$ ?1 C0 o+ H0 y A( L Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
; t" i# d H# lemerging markets have no problem with funding. |
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