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发表于 2011-9-17 13:16
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Current situation$ |$ Q1 r% h7 s5 V) {9 o3 T& u
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long5 |3 M3 N+ ?& p# h1 @
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
% e1 v3 Y/ s) r% z+ A( timpose liquidation values.
$ P( N [ n$ \ In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In A _* u! E6 |6 J" J1 X. n& u
August, we said a credit shutdown was unlikely – we continue to hold that view.: t0 _, q% _! E: ^* C
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension' E( Z( m* W2 J! Z% M" L
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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; V" {7 E) a! l' D) XA look at credit markets
; Q# T T$ p" U- w$ x& U- s; Q Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
7 j( @ @# P( G+ x3 h5 mSeptember. Non-financial investment grade is the new safe haven.* b; q" }+ }: m! [6 s
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%, g% i+ b- I* u* }5 K4 Y
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
; A* Z3 m8 A. a! Obillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
' T0 D n9 R& }& ^5 ~, o. uaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
( X: Z W1 p0 m7 h: o3 D! dCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
X3 `* ?7 H. }, Qpositive for the year-do-date, including high yield.
5 @, E9 j- t# U9 u$ N Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
D% |5 b/ D& v; Hfinding financing.
7 x& n3 ~0 J& H: l" J2 w, z9 G& O Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: `/ J/ S+ Y' [0 K. k4 V
were subsequently repriced and placed. In the fall, there will be more deals.
- d" P' O5 n _7 W/ B Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and4 _6 o7 K x! n1 _ ~
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
$ U9 ?7 g) P5 Egoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 A( \: H" n2 |4 A+ F. }
bankruptcy, they already have debt financing in place.
& h- A) r3 B8 ^: D; S0 R European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain( n5 Q3 @% |5 z9 {. [
today.
7 P/ j, Y0 `% j1 E Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
" b0 k! O3 I7 P! G0 Remerging markets have no problem with funding. |
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