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发表于 2011-9-17 13:16
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Current situation
; a8 r6 v9 E5 P' H! v The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
& o* [; ] D! |% I" I. e! Das funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
% s8 C1 r" Q6 E1 bimpose liquidation values.
& B. ~* T2 s7 n In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
; u# P: G' l# P# fAugust, we said a credit shutdown was unlikely – we continue to hold that view.
; L$ E; g- k: s7 f0 g8 O The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension7 d. |+ s1 _5 ?8 m: A6 _( E
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
3 x; d( `0 I0 o) w! w7 m6 J3 P Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in+ r) T7 s( v9 i g. w" {8 q
September. Non-financial investment grade is the new safe haven.
7 U. O7 n( g( t, V7 |6 } High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%" J* `; Z. ^# @% i9 |1 a
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
0 M: n0 ~. v: j7 a7 Nbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
; V9 R0 W$ g9 ^5 h3 G* oaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
, T* {1 j* x8 ?CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are( s. F$ i/ [6 Z9 @7 z9 t
positive for the year-do-date, including high yield.! t+ Y$ P1 P( [# v/ T
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
+ U, j6 b7 P. h) i0 ^( h2 Efinding financing.
2 s2 ~1 f0 w5 u, J( Q) B Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
6 s1 n( I' Y. n ]were subsequently repriced and placed. In the fall, there will be more deals.6 T; v/ j0 P- ]9 g7 j
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
( m6 s2 j- n! y3 @8 Nis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
+ V1 `( y' |1 m. J; y' P" q# @! jgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
' `4 ~) F; V# o4 \bankruptcy, they already have debt financing in place.- }; _' F' R& J! p) w) W- p
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain8 x* F" y" |) {. N: n- Y h
today.
9 h: N8 i8 W" C1 V0 S" R' Z Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in0 ~4 Y6 f/ B2 ^/ y
emerging markets have no problem with funding. |
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