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发表于 2011-9-17 13:16
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Current situation
3 ^$ z5 j) `, X3 \# e/ l5 ? The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
& g3 j7 b$ w9 w1 \5 U' i; G3 g, {, v5 Uas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may" D$ e4 P) ?* \; n: T5 c: _
impose liquidation values.
, l( q, P3 T/ ?6 t+ ~/ Q In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! h7 O, r& P3 G% SAugust, we said a credit shutdown was unlikely – we continue to hold that view.2 v' u6 z% l5 k
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
& u& R* m c& f6 O5 escrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
, G5 M3 t9 d; h Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in8 @- m5 b! i+ b' \& e
September. Non-financial investment grade is the new safe haven.
% j, k* G9 q+ u. i3 ^, Y8 \4 Z( e& S+ D High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
% u: F/ w5 g5 Q$ V8 X. a5 qthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1/ d! C p7 B& l+ j, a
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have/ m, W4 X# H4 Y# z5 H
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
9 ?6 |. E- B( _0 a& \CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are8 R* M; q1 L7 f4 S- b" k+ a( e
positive for the year-do-date, including high yield.
# m3 T. o! }- m) M. E/ j- p2 J Mortgages – There is no funding for new construction, but existing quality properties are having no trouble. s- ^# q# t4 |+ I3 P" \
finding financing.$ W- Z& ?# Y+ V6 V+ I5 q* s
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
' E/ b: Z* k) M- Qwere subsequently repriced and placed. In the fall, there will be more deals.
4 t+ a: G. {- y. w8 B! A# u Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and# N" z7 p" [1 `3 k% j$ Q4 }
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were2 h! i5 N% ^2 x7 d% G8 g# ]* b
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for( | W: S) v# Q0 K# p9 X
bankruptcy, they already have debt financing in place.
8 X) N- r# h- s European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
9 s; o( {7 g, K2 s: a6 B( g; q' N* c4 ~today.5 W" [& L0 q# n+ v& n, j
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
7 a* U) E5 N$ T/ Wemerging markets have no problem with funding. |
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