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发表于 2011-9-17 13:16
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Current situation
- N2 J" S y6 M4 {: {5 K6 i; w The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long8 o9 [9 m2 G6 j4 A( O2 z
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
: t: ~( U6 u( ?5 }2 Limpose liquidation values.3 ^ w- L8 L( \' ?+ n
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
* A+ P0 }7 a! U3 ~& G7 ]* nAugust, we said a credit shutdown was unlikely – we continue to hold that view.% h, I* }, i, U* e1 W
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
' @- z& W- A/ m$ U8 ~scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
' x' b$ `0 e2 P: T
9 t; v8 `8 J YA look at credit markets# E2 m0 K* r7 q6 O
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
) b+ _' m! P3 M+ S7 Z- OSeptember. Non-financial investment grade is the new safe haven.
4 T- m: E' o- ^0 `( Q5 g0 o1 `3 y8 t High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
" l; o: i/ H1 V$ {" O% S+ ~1 Lthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1. I6 `& y- P0 U- u$ N& `) F4 M
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have; k$ K( q) p3 U
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
2 C* B3 n) n' }3 r+ M+ m5 V2 U$ x% G% dCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
8 o: |* y1 t1 x! u( O+ G: Xpositive for the year-do-date, including high yield.
0 d8 p3 g0 z) T$ C. a- u% N Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( _5 \ H1 `$ d0 q; M
finding financing./ C& J/ b0 z0 f8 @ p& U; ]
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they/ E# C3 p+ u$ I6 v2 I: |- M
were subsequently repriced and placed. In the fall, there will be more deals.
4 G: E* a Y2 _4 C Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
8 w/ d) z+ w0 X# ~' o/ ]is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
1 f, |$ q0 t) \going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for1 {; u3 ^/ N' V2 [
bankruptcy, they already have debt financing in place.# c9 y) r$ A) a: d, J L+ J
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain; z) C- g2 C+ e
today.
9 h: v6 z& d( S- Q7 i, l Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
2 {- V' u, |: J8 k' ?$ ?emerging markets have no problem with funding. |
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