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发表于 2011-9-17 13:16
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Current situation. j! L1 P. L% ]* X( p* \5 J
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
) P3 u& v8 }/ `6 z! Pas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
$ B% C, Q! I/ G& | S Timpose liquidation values.: ~, X8 B4 ?4 f1 [ M3 G4 `
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In4 J! J1 x- R) \ X/ u& P+ L8 G
August, we said a credit shutdown was unlikely – we continue to hold that view.
, B/ m% y" m7 f* W The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
0 X) X+ r0 v6 \8 B! oscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.: }* H4 z5 x7 Q N6 `& T/ R
" M4 p1 }' B4 Z! W: v( RA look at credit markets
0 k3 ~$ I: e. k2 K, [+ i Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
- L* m* T5 E5 y+ FSeptember. Non-financial investment grade is the new safe haven.
9 ?3 U2 i& E: s4 d0 g7 r5 P High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%: h1 F; H1 Y) U
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1* |0 R- H8 |4 T) X8 l, Z6 K
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
6 g. n1 R, x+ Y8 J" T( T# U4 \access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
5 ^9 W1 E. `4 t& S# S4 u" g4 E. T9 |5 GCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are. K: ~8 `' S2 O6 H$ X
positive for the year-do-date, including high yield.
1 M( i& m' u& P4 m Mortgages – There is no funding for new construction, but existing quality properties are having no trouble- |2 x; o, |; C' F0 ~4 \7 A' i
finding financing.
- q- O, T- d" V. k) J) g1 J3 Q Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they- {* a5 `# @; N G, |/ n
were subsequently repriced and placed. In the fall, there will be more deals.
2 } \8 q4 q& } Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
& |; l! j! z. v% H0 a+ I! _is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ Y" n( ^1 u& C7 B6 h, ?% t
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
H' w4 V8 \* l; T- f* abankruptcy, they already have debt financing in place.
: A- ~3 u4 M7 t8 _* P3 T European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
+ o5 d0 U' \# H$ Stoday.$ H. j* z- [0 u/ M/ k
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in; d. d; B- w3 g/ P& s! C* h
emerging markets have no problem with funding. |
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