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发表于 2011-9-17 13:16
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Current situation1 B+ _: v/ r! g( e6 Q) ^
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long: ~3 i6 P' H2 P$ A! S3 W
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
9 W( ~/ } V, z$ e z3 J7 o g. mimpose liquidation values.
; Q% K0 \* H! n( b0 @ In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In& Y* Z8 Y4 g8 v# G
August, we said a credit shutdown was unlikely – we continue to hold that view.; u8 ]; I7 Q( ~' } g
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension4 K) I( @* [1 }8 W
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.3 W7 b% B2 |) j
2 a$ V2 P* {5 rA look at credit markets5 W. y# a4 E( j+ k
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in+ ?: X0 Z' a4 I/ [
September. Non-financial investment grade is the new safe haven.# a% b n5 e; p" _6 o- I( v
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%4 T" _( `. Y6 s5 q
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
8 `/ i' H. Y5 o8 Hbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have0 [% w/ R% f9 g* H: c+ H" s, W
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
- c' @/ N- K7 v8 g% P( wCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are% X: x( k5 D) x# {
positive for the year-do-date, including high yield.; I) n: e" ?. k, W1 U8 w7 @
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
& T% p1 T! M; ~0 {finding financing.
3 G# S% b, ]8 J3 o Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
9 @9 V) ?- y% A8 q, J; ~were subsequently repriced and placed. In the fall, there will be more deals.& |6 X: E6 v( ], z- `$ e+ Z8 R/ J
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and6 ]- \8 O2 X' Q8 Q8 a
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) D! c& ^4 @" ]6 Ugoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for+ z% H8 |# B. V: |: t) [) S& @
bankruptcy, they already have debt financing in place.
' V7 a: r8 K" [ x9 p European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
1 [8 Q6 W& m( A q+ Btoday.! ~3 ?% A1 C$ Q5 u3 C) o/ y: |
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in3 y0 T( y7 a* l" `$ p! Y+ y
emerging markets have no problem with funding. |
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