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发表于 2011-9-17 13:16
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Current situation
8 O9 p7 o6 D7 G5 }# o' o The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
d2 X: G+ o+ t! Uas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
5 ~" D3 Y: a4 H" Oimpose liquidation values.' N1 G/ ^; R- j" ?
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
, E" F/ i. H) h. ?' EAugust, we said a credit shutdown was unlikely – we continue to hold that view. k( {$ `( Z- }* r s. Y
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension: \$ }" ?9 Q6 W! V: R' E; E
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.8 L( R! W" r6 ^. x/ z' C2 F' i
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A look at credit markets
4 j' h: @/ `- s2 ~2 ~ Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
5 k: D) w3 P/ w# I% a) p# Z( o+ RSeptember. Non-financial investment grade is the new safe haven.8 `8 O7 L8 j4 }' n
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%! l4 u7 K/ \0 o1 w& `4 {3 h, B
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $11 B* r7 M9 q5 z: a; ?# ]
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
3 w4 K7 c( d0 F+ m2 x3 Laccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade _$ w& w/ h) n& }6 d
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
( @( j$ x( E0 U% ipositive for the year-do-date, including high yield.
1 U' |7 x {( ^0 S3 z7 p Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
3 v4 O. Z( g* A# l, tfinding financing.% B& \3 C3 S% L$ F4 B5 [% o
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they6 H0 R) z% S) X) {- V. o* P
were subsequently repriced and placed. In the fall, there will be more deals.
2 O3 Q8 F( ~ I: V$ |4 Q) x' V5 a Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
% N2 ]8 e4 u! q+ |is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
( F! q) V0 `0 z9 J! v' O1 Z C8 L9 Dgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
, v y7 D D: nbankruptcy, they already have debt financing in place.
- d, |- }& c1 K* U European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
3 c: @; O1 I; b0 g2 l1 Xtoday.' {) ]8 K+ \: G! E
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in" p, Q6 S6 s; c: j# d G x
emerging markets have no problem with funding. |
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