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发表于 2011-9-17 13:16
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Current situation
6 Q0 F* H3 Y' R& S* P+ j- W The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
8 D/ O9 G' p7 f1 b- e! Cas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
& H' y" L# I% x. T2 {8 yimpose liquidation values.
+ }( |. p9 P" b% g# D In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
~4 t9 M' }& }* TAugust, we said a credit shutdown was unlikely – we continue to hold that view.& j& z$ Z* ^% ]3 S: g
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
( n: ^% X2 K3 p* p2 h# g' ]: wscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.& b% z2 g1 d m
, g$ y8 X6 V2 S3 E8 qA look at credit markets* U) \2 n6 `% e4 T0 f
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
0 A+ }7 p: z1 R6 V2 n5 q2 ISeptember. Non-financial investment grade is the new safe haven.3 z2 [0 Q3 J7 K' i& k; R
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
* X; Y4 d( [0 p: s, a+ K+ u8 B6 cthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
8 _3 w2 |: L( u4 Zbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
0 g4 o; u! {+ c, R1 Xaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade6 S: q/ v" @5 r/ b7 }+ P6 h s. Z
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are) P5 b# ?8 P6 w6 s+ Y" ~% s
positive for the year-do-date, including high yield.# n( m c9 o4 S
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble% O( H# J( c0 P: m
finding financing.- J! K) P, ]$ s7 y7 j! ]; Y7 A
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: f( u( U; |/ S+ _2 f
were subsequently repriced and placed. In the fall, there will be more deals.
3 k& [2 i9 {- e' ? E( t; s Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and6 H- z& ?3 F& x; [6 K! v5 H
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were" T" x' c- Q! V
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for2 U7 E! D* Q `- |( i
bankruptcy, they already have debt financing in place.
5 o; T+ N. n U S- y, y& p Q European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
2 G; M- n5 F* ltoday.
, m7 }5 T% n3 x# m- C% N7 }9 c5 y Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in( u# T. l% {: O6 R; E
emerging markets have no problem with funding. |
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