 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation0 D- w* e6 n0 V$ l( K/ d/ {, [$ x
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
% E4 L* W3 s3 D- c( h& ?as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may( |" r7 i- Q7 A6 m
impose liquidation values.
" [( r5 }4 m$ h6 G" [! G* ] In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
# }8 i, S$ T- C6 f0 S$ t4 ?August, we said a credit shutdown was unlikely – we continue to hold that view.
9 K: H; n- l$ V5 W" q: {9 q; I The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
; u# r% u* B2 h6 T3 @- A+ xscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.* {- D5 H% w4 x# A
% ]' m: K8 r! {. r
A look at credit markets: A6 J* ^5 j3 x& X4 B
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
5 v4 W7 C- l2 }6 c! g) x& V# u9 P. \September. Non-financial investment grade is the new safe haven.3 _: L! V; b1 A/ @
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%+ R8 p5 {. v; ]( U0 }
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
& f+ ], T: R$ `$ Z5 _* t8 \billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have7 @( D) ?0 b8 M! L8 T, x. M
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade& G" Y2 O- j) m$ P" p- ]% N: T% ?4 W
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are9 r1 q) t3 P7 c1 E- o
positive for the year-do-date, including high yield.( ~* O! {2 b2 V0 u) C! C
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
6 M; j3 Z7 g8 |2 {finding financing.
9 ?6 ?9 K/ f2 D4 T! k! M& A8 r Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they3 G+ X' R* n0 I% J- @' |
were subsequently repriced and placed. In the fall, there will be more deals.1 Z+ ~/ k' J2 S) Y
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and! N! F9 l" z6 r8 x" _
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) f e9 K @0 S* Z, ~& C. O* h7 \( w4 Igoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
" O& v$ K# _) h9 K1 E: y3 [bankruptcy, they already have debt financing in place.8 I5 J) K- \. U, g& @8 z" h
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain; G* b' u* k% R% V3 I
today.$ |1 b% K' M4 m) {
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in+ B7 q6 ?% u' m; y) c
emerging markets have no problem with funding. |
|