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发表于 2011-9-17 13:16
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Current situation7 ~5 |9 N: t* X: K/ z- m3 }6 s
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long, F$ n/ @- S7 l
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may& ?. r0 ^1 K* {# l) q
impose liquidation values.
7 V/ O" O+ R. q2 k& ^ In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
/ P; \6 }7 K, I) \! ?% rAugust, we said a credit shutdown was unlikely – we continue to hold that view." i$ E: L2 z7 \, N
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension2 ?% u4 R }0 P) p; L: W; v+ Y* Z
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
6 |* ]& e( j, A Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in1 ~6 ^5 s* K/ L; I
September. Non-financial investment grade is the new safe haven.$ g0 |7 l8 X7 e# o. _' \
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
! t( ~* [% R! k$ ]0 e: ]5 J: g4 Tthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $18 _' N) \6 q" E2 t% l
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
. s8 `8 a0 P$ F8 E* n0 E0 j y- z$ J8 [4 eaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
$ p) X3 M3 @. D+ \* W/ u4 xCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
! y: m9 M4 ?+ e4 e3 T' F: {positive for the year-do-date, including high yield.$ @# X8 T3 H( l2 e: x* ^
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble' {( G7 F5 o3 g: J1 E
finding financing.
' u/ `( A4 V2 ?/ ?! f" f; K Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
5 L) g& L: v7 r& y r% j% S/ Bwere subsequently repriced and placed. In the fall, there will be more deals.. z' y W0 B8 |
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
H6 U7 I0 t; d$ X) O2 i1 B$ U! ~& ^0 xis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
, ~" }4 W; B: b8 i, h# wgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
% x6 P H3 B& f6 o, ]8 Bbankruptcy, they already have debt financing in place.
7 Y2 ~/ j6 T/ J European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain7 c5 R$ G& C" n" g
today.
+ c) j4 Z; A; d* ]; F: p( H: n Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
; O6 ~8 q/ N. z. Memerging markets have no problem with funding. |
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