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发表于 2011-9-17 13:16
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Current situation* s8 R5 y8 R/ Q' o" g. R( Y2 a; }
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
! c5 ^+ x( h( }, b+ M% b/ @7 Eas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may) Z2 C1 Q4 ]* [5 n0 _6 j( C
impose liquidation values.- Q0 w2 J, `8 D! Q4 V/ G
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
- [ H8 q5 J) }, K9 c8 k6 PAugust, we said a credit shutdown was unlikely – we continue to hold that view.7 l" s8 e) h1 s+ A
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
1 B8 T# M) Y0 h( Iscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets., s7 U3 J% e/ U2 [
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A look at credit markets# C" {* R, X3 ]/ r0 |$ J
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in q9 @$ M8 w e
September. Non-financial investment grade is the new safe haven.0 V& r7 i5 R, l4 Q
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%- H# t( n M8 C
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1& c5 `4 R O3 H- ?) b
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
' V. O9 O: M9 U2 J* [/ laccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade" V' U+ l4 L$ _% F* p
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
& H* R9 ?* `3 E* ?positive for the year-do-date, including high yield.
& |' [6 ~1 {/ C4 |/ z# t Mortgages – There is no funding for new construction, but existing quality properties are having no trouble' O/ v; ~; I4 k% D7 E
finding financing.* Q& s. q4 t4 M. T7 a9 W% ^+ A
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they/ ^4 G$ [) Y( Z" r4 V
were subsequently repriced and placed. In the fall, there will be more deals.9 O9 B. Q" ?, ~" p5 A f$ a- ^! f
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
1 k( T% D. N! p" P( mis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
6 K: z+ m( A& B9 B1 r9 Bgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for" o- \7 x9 W, B& S0 a" }
bankruptcy, they already have debt financing in place.
I5 q* f$ Z n3 ^5 E European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
" w- j% m4 V0 `6 D8 R* Ctoday.6 k+ W% ~0 u: q& }- T4 \4 E! }7 V
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
0 Q5 ^1 u# y0 m! F3 w; temerging markets have no problem with funding. |
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