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发表于 2011-9-17 13:16
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Current situation$ G" R3 u; B& b
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
0 p* g8 y4 M7 H6 {/ \5 f( @as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
& O; N. [% c% timpose liquidation values.1 _! J; U) }0 K" p7 t# L% _, b
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
" n. i: d( }8 o/ l3 M1 iAugust, we said a credit shutdown was unlikely – we continue to hold that view./ W+ h" k4 m8 }7 A8 B
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
l$ E8 n- I8 p% Z0 L% Rscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
* M# \0 z# _! K& g; v8 R2 q9 a/ Q Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in# j- Q+ ?3 m4 o6 H! ` X! N, K' f
September. Non-financial investment grade is the new safe haven.
! d6 G, w5 u5 `3 p- n; x7 x( | High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%" m1 M4 R, a, l& K" A1 e
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
2 o% @" c9 D9 e+ M Y" C E8 o6 Xbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have1 `; ]4 X5 C& g3 K+ \- W
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
+ Z: I7 C( \# f6 b6 q( Y9 vCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
: U6 Y7 i# Y1 Z: p. f0 f: F; W. rpositive for the year-do-date, including high yield.
/ `" e& d, [/ f Mortgages – There is no funding for new construction, but existing quality properties are having no trouble' @& H! G* \$ w* d# m# u& a3 C9 v
finding financing.
3 r: T8 v: d, W Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
& @1 x) a$ J5 F" B% q& fwere subsequently repriced and placed. In the fall, there will be more deals.0 B, C' J. e q# j5 v
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and- K& N- L" l( s1 U" h5 \+ l ^% v# b- P
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
$ m9 v0 z; ]0 D3 v- cgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for% x. G) ^" K, T+ p: Y# `; t
bankruptcy, they already have debt financing in place.
- M/ K- e( D1 Y8 g2 `/ j European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain7 L/ y+ K4 r" ^
today.) I9 C& d1 P% N! S5 M8 `* |) j
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in5 A0 Q, G0 t2 e# n
emerging markets have no problem with funding. |
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