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发表于 2011-9-17 13:16
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Current situation; q& [7 ~5 \$ d0 }6 a. z9 x' D: w- D
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long) w+ {4 s! M7 l: }$ b9 ~
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may1 d! ^2 s7 V& S' | e
impose liquidation values.4 Z( N5 _; d0 }5 K# ^
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
: N2 |1 @, k2 u" NAugust, we said a credit shutdown was unlikely – we continue to hold that view.4 i, |1 z2 n z3 ]
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension8 i7 c2 D# ?9 ^, ]
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets# G, c! V" `* z9 N6 V( o
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in5 y: e; x4 y# f, C, y: r
September. Non-financial investment grade is the new safe haven.; P3 q! O h" [
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
|' f8 r* s4 Q3 Wthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $15 z' B; n+ O% C( f4 s0 F* n: G
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have% ?( ?5 I( Q4 S t
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade4 N/ q# u4 I/ O6 R( W' K
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
; ^ L0 @: F$ ]positive for the year-do-date, including high yield.9 S6 H% V& w+ X* G& @( F& _- B
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble9 @* [1 u2 J: p1 b' v1 Y
finding financing.1 [0 {3 R- L* k! D. M: s5 G) y
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they8 m+ e Q6 _" Q! w
were subsequently repriced and placed. In the fall, there will be more deals.# R( A2 p y- C/ b6 H
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
) K2 l/ j6 v- L' H& {0 Lis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
+ A% s' b$ G, _. Lgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
0 P3 K5 P6 R! c! M/ d1 L/ b7 C4 Ubankruptcy, they already have debt financing in place.
% `9 A) E0 r) K P: L. L6 s European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
# L& |0 t' S: Z1 k7 Z1 W7 p8 mtoday.
" S! I$ {3 q R Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
% L( O# i& A! `' bemerging markets have no problem with funding. |
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