 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
0 c* F, Y8 A. @6 U/ M) J3 {6 X The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long( f9 u, A; S* U$ I. c o* i* M9 R
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may6 C4 ?# e$ d: E/ A) M% K
impose liquidation values.
- {+ A8 x6 ]( b% i In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In3 N+ j2 H. u" z L4 O. b
August, we said a credit shutdown was unlikely – we continue to hold that view.- e- s- D" V6 ^8 N7 H/ z. ~
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
6 E6 D3 y$ |$ Y! `2 J- Z0 wscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 x0 Z( y$ P- G0 m
0 U- M& S, ^7 W9 L
A look at credit markets
9 e& n+ h) @$ p/ t# }8 [$ G Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in" A8 `# r4 ~9 U: @
September. Non-financial investment grade is the new safe haven.
4 L3 |( C M* j High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%& @: Q* o* S! _: q7 a3 }- m
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
# ~- Z' H( T F, M! P" F6 pbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
- O/ }1 @/ m$ H" \/ Laccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade7 [% r# I; w0 A
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are" p$ g' P) H( s, R
positive for the year-do-date, including high yield.5 z ?; j( S$ H( f3 h- @
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
$ ^( J" n! m" sfinding financing.# ^" O! s* a! {. k
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they0 n5 G+ Q1 g1 |2 L* T9 S
were subsequently repriced and placed. In the fall, there will be more deals.- @! b( B) Y6 f% c8 |) Z" @
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and+ f# n0 C3 Q( H; L
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
6 G) M6 `. R6 ~, Lgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for" @* l* c9 T, O: g9 E! b% L
bankruptcy, they already have debt financing in place.
N# W' I/ ]) a) m European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain$ `; z' @1 u/ p3 D6 q! b
today.- l- i* C* a+ q @
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
% {3 d q; l. h+ Lemerging markets have no problem with funding. |
|