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发表于 2011-9-17 13:16
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Current situation* g0 k! w. Z& x( t
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
( F8 h- X2 [/ \9 W$ Cas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may! I: T/ i4 m) Q( u
impose liquidation values.
9 |9 H( C$ W, L* b! F* p* D In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
% k/ |* W0 G; |: EAugust, we said a credit shutdown was unlikely – we continue to hold that view.
9 `, E" W+ z0 ]$ H; k0 P) L The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension* H: M5 f5 M& `- X( q. k2 |6 }* I
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.( I( z) h6 S7 I. F! h& e( P5 R
, i) `3 K+ X2 F7 BA look at credit markets
1 T g, A7 o/ m$ Z& k Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in9 L# m6 W0 S0 w+ u# f
September. Non-financial investment grade is the new safe haven.( N: W; N- K( I
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%- S3 w+ l6 l* b! C$ J. V
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1, i0 ]1 c P+ F' L% S1 T
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have+ l4 A4 d" R3 Y# ]7 y
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade7 |* @ P% H3 |" i; X$ g
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are1 w( {/ j# n4 T
positive for the year-do-date, including high yield.# G2 m$ B( T7 J9 s' t
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble/ n* J5 s1 `4 F+ b! H
finding financing.
6 M1 i. j7 h6 l# f) ` Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they. O1 `; a* q2 T7 P. W
were subsequently repriced and placed. In the fall, there will be more deals.
& [1 @9 ^2 ~3 w! H+ r: n$ C( B$ k Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and$ g* { ]$ e& e. g. t7 ~8 d
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
6 h* [9 T" V9 egoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
( @" D" [* S7 u9 u# }1 Bbankruptcy, they already have debt financing in place.
: u3 ?0 K" z+ I% Q9 P) \! e# { European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain3 A2 V' a+ |: V3 y0 N4 Y
today.
9 W, }) N& D5 E" w- ~: R Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in; I/ A1 o2 e! i. s( }
emerging markets have no problem with funding. |
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