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发表于 2011-9-17 13:16
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Current situation
% [* \' ~! f5 K9 x9 i) v% E The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
. W, A7 t/ q; xas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may3 `. P4 c0 w1 i$ y
impose liquidation values.
4 T* {* p/ P% R1 D/ I. A7 @3 h In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
3 ]* s" [: c) t# S2 ]; [1 g( P2 y) uAugust, we said a credit shutdown was unlikely – we continue to hold that view.
* }# j0 e/ T8 C" S4 @% B The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
. }! c9 U8 u# C/ Z2 o! Uscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.) P$ e# \/ r3 D$ W
1 M9 q$ f4 p/ M" d4 m
A look at credit markets
( Q& L7 s7 J9 z Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in$ g- j, v( L% T& @/ \1 |5 Q; C
September. Non-financial investment grade is the new safe haven.* F. l9 _* A4 |& {
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
7 Z3 H3 [0 f/ t" v) [( Fthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $11 [+ i( Z6 i. N: h! N
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
7 r9 L' w( V. t* J( ?access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade9 B' T8 c2 }7 {+ E4 }0 \/ u
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
1 a# A, ?& V0 Y' W; j4 Y% kpositive for the year-do-date, including high yield.: ?' S8 h- {" n5 b8 c! |
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble; u0 J7 \, e& ?3 H) V) X
finding financing.5 H9 i2 M1 t. R
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they& v' Y7 M- ~ L) A& J- Z: c& h
were subsequently repriced and placed. In the fall, there will be more deals.! ^. \3 K" I$ ]/ ]. v! ^
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
3 f4 i- H' R; j# a9 W! `is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
H9 t3 A& ^4 Q& u! D8 mgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
# b' A7 ^5 ?+ J8 U' ubankruptcy, they already have debt financing in place.$ B4 B6 A# P3 B+ V
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
7 |3 Y8 v' T7 O9 y3 Atoday.& j- l' c, h+ v
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
0 Y! }: G1 Z+ `( I4 vemerging markets have no problem with funding. |
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