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发表于 2011-9-17 13:16
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Current situation2 e V9 W7 y9 V l/ w, f
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long6 H/ w$ L3 i4 ~$ \ a0 j
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
: W3 j5 u2 Z. F8 e* S6 M6 D k0 Rimpose liquidation values.
& Q' \2 h, ~# M( B( R% ~4 f6 b In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In8 D P! s4 \8 N: W. D% b! C; d9 r# s
August, we said a credit shutdown was unlikely – we continue to hold that view.
# I' g( J5 w4 }1 | The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
@6 @: X* G9 \! E! Sscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
+ G% L7 _2 j( U: _1 x7 @- y& l- m Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
5 F6 w$ w, C2 a8 ]/ Q6 OSeptember. Non-financial investment grade is the new safe haven.
0 ^0 r" j" y' z High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%* S) l0 m( H, ]' g1 x. U; _
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
% p. v& R5 B( l) S! D6 g+ K7 }9 e: |/ gbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have( m0 L; ]* S% L. |$ y! K
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
: F, l3 p3 A+ |7 }CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are d) j$ p4 S4 m5 _
positive for the year-do-date, including high yield.
5 j2 h" k6 N! y Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( J. K9 @& K/ ]$ p5 ?! I
finding financing.
: y5 J6 q f! u- G- N( H Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
3 C) [: } \. H6 {! { `were subsequently repriced and placed. In the fall, there will be more deals.
) u7 @% z- g& |, ?" E6 s) n Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
( X, B+ M3 _7 d9 W2 i, Xis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were; Q7 D5 v. o. F% w& M
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
8 \+ v" Y: p/ K z$ U; @* U+ dbankruptcy, they already have debt financing in place.) D6 t8 y: {0 ]) y k' [! A( Y; P, Q
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
6 Q# ^% [3 {% M. _( }& `& l% _/ u3 ztoday.
+ W' k' M9 ~4 N( b+ |- `9 x. W( C' Q8 R4 @ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in% C: c# d7 q9 S9 O' O) v
emerging markets have no problem with funding. |
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