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发表于 2011-9-17 13:16
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Current situation
; f: R& f4 W, d8 L8 k The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
: J% O r6 M$ {/ L6 s; ias funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
/ \+ P8 a' r; l: timpose liquidation values.
8 m% t& K2 P$ _/ k( W# f/ h6 v" |2 g In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
' H D6 u" O3 k/ |) t4 `: A7 eAugust, we said a credit shutdown was unlikely – we continue to hold that view.$ v0 W$ [8 R1 i) p. m0 Z
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension2 \4 t$ l! `) r' i' K
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets: k+ T [4 F0 U: e) X
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in$ H6 X q& L. }2 ~3 T# a1 q. H
September. Non-financial investment grade is the new safe haven.6 H! D }4 Q# t2 q9 i2 G6 ]
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%6 D; A, R$ ?# f' I
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1* }3 S M% W4 E, H& i0 I N3 R
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
- x: h3 }2 ^, D; h+ H' @% F1 Kaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade2 e# d7 b4 Z! y Z8 q/ e
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are8 Y- ?% f1 U; u0 {: E T) K
positive for the year-do-date, including high yield.# ~: {5 O7 l" I y2 j$ G. {8 D
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
l: T! @6 o4 D8 @& @finding financing.- g4 U, L- I. O% j+ ~' @* d
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
3 {. V, t3 v# u0 U( G* owere subsequently repriced and placed. In the fall, there will be more deals.
6 X$ a5 z6 `& ]8 m* z3 f& | Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and& b( j! d; K7 w9 f: o
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were5 K4 `0 u" n. o& J/ _! l' |: \/ ~
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 e- G3 P+ q. x! b$ u, G! ]
bankruptcy, they already have debt financing in place.! w( @7 N5 q! _
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
7 s1 Q- u/ P8 Y2 v( o) @today.3 j" Z( R ]' G& l( h! ^- Z
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
. |1 L; g, B4 a Remerging markets have no problem with funding. |
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