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发表于 2011-9-17 13:16
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Current situation9 i) z/ n' Q* G4 X" N2 A- M
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long; P; o# J9 Z% L* x$ v" l) k0 p. L
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may- ?" j- K, I, U' {
impose liquidation values.
. x; O6 {* s4 B% | In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In& |; v: p- x7 G% y! c4 p
August, we said a credit shutdown was unlikely – we continue to hold that view.5 E6 M0 {0 T- S! s, c# z" F2 k
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
1 m# c8 G5 j( c0 }% x) Lscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 a, m( C' ?: ]1 P7 F a2 }
7 D* Q; \5 C: F) C# D) I4 I$ w0 wA look at credit markets
! t7 |) r& h# P- e( s( O Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& n# K% X) Y/ |0 T4 F9 rSeptember. Non-financial investment grade is the new safe haven.
+ |! ?1 {' B! O High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
1 c6 y+ N6 G% F8 Pthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
. C1 L1 i! I5 Obillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have/ W1 e2 E$ F3 y6 |- ^/ V9 p
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade! |5 L3 a) w0 P$ u
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
+ ^, g5 _; `! o$ A0 p; [( dpositive for the year-do-date, including high yield.8 f( w! R: \1 G. \4 H
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble" Z- Q \9 W* h2 W
finding financing.1 d1 N0 p8 H( W% X( K
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
3 ]8 R: N1 v: Owere subsequently repriced and placed. In the fall, there will be more deals.
9 l+ u) Q9 c- {% | Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and4 {0 Z$ G) T: S: S& C
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
/ Q V+ k3 X. Y' m' `9 mgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
( R- D4 |# s) j3 g9 d, Zbankruptcy, they already have debt financing in place.
8 r% R2 U' S/ Y" ^9 b" }! Z; N European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
2 u9 D- _" m: q8 f6 q. _- Xtoday.
' _. h- D! D! Q) E& Y# e Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in% U7 B+ e; p) X/ k4 n
emerging markets have no problem with funding. |
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