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发表于 2011-9-17 13:16
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Current situation
. [5 x9 L3 [, f- R+ d: s; |, F% `/ X The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
; @& Z0 t+ U& ?3 a* B2 W, d3 Has funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may2 e& L& c) y; ]4 f+ r/ p
impose liquidation values.
5 R8 k& [# N W/ R! w1 |4 }5 H In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
9 p4 k/ I4 ]( H" H3 `$ v/ rAugust, we said a credit shutdown was unlikely – we continue to hold that view.9 ~3 l( j7 O7 H$ E2 b/ a
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
& W$ l* B, j/ D7 m" ?' B/ x& uscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.% ~- H" R- Z/ o8 S* f( }
! z8 F2 o& C! {* I ^' c% H
A look at credit markets# y# V; a; Z2 [* R+ P1 y) D
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& j5 z% @. ^8 r z7 DSeptember. Non-financial investment grade is the new safe haven.
7 n- n; d, Z: M- c High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
9 e2 ]2 T1 j* p! Z! gthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1( N( s3 Z: z3 w# k7 T! u
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have1 @8 Q- v. x; x: r4 d
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade" }+ b+ V4 W- u: l3 G
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
2 Y; {. f/ B% tpositive for the year-do-date, including high yield.
- J t, C; g% O Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
% P+ T6 e. a7 V5 C- ~% @finding financing.
# M3 c. ]# P L; _2 d* p# o Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they, X% a2 G N- X7 A2 p0 O& U w2 U M
were subsequently repriced and placed. In the fall, there will be more deals.8 K- ~: q2 P2 }
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
7 M( i* ^4 a3 S( x8 Z5 s. Jis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were1 C% K, n" a" w) `. E
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for! s) O% e9 g! r+ x
bankruptcy, they already have debt financing in place.
" ?! a8 M8 s' p$ t) |% a2 m( e European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain0 |, g5 \: P5 q
today.# S5 r3 N" I( b; m9 H1 M
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in# B) T8 s1 n% ^, M- n$ Y
emerging markets have no problem with funding. |
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