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发表于 2011-9-17 13:16
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Current situation
" N6 W6 B, B% n0 U5 v2 N The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long8 A9 `8 {1 \; D, o( t$ C
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
! N) U0 s% a& ximpose liquidation values.
) J$ I+ b3 H- W$ j2 i In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 j: I4 t& b- Q1 ]2 Y/ G0 X6 f# GAugust, we said a credit shutdown was unlikely – we continue to hold that view.9 Y: I! n- j4 @0 d# e7 Y2 o% ^8 a
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
+ o4 c) W9 E3 R4 v9 t9 cscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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: }! Y% u% P6 Z$ D9 MA look at credit markets
8 v j5 |- F" d$ \% B; b+ b Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in D0 A7 m+ |5 k6 Z/ z
September. Non-financial investment grade is the new safe haven.. n1 W! V5 }- O6 s
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%5 X! k- h$ Z) j* u( d, y
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
/ L. w8 D5 D5 n; ~! E/ ?2 bbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
& E& N$ Z6 P; uaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
( L3 h s$ d1 o( C# I! w! O% ZCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are* q7 }! ~/ y0 N' I% w
positive for the year-do-date, including high yield.3 T, c' u) p' W
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( q# e4 I# N2 K- G5 p3 ]
finding financing.7 ]/ v+ { Y! ?: Q1 ]2 ]; ?! p
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they: x* Y, Z" e3 m; @
were subsequently repriced and placed. In the fall, there will be more deals.
# k2 i; `' g% f0 z4 X3 R Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and. w' E t/ P; y, t, H- E" j
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
. c; m8 C; G, G% J) U" ogoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 p4 a8 @, H# ~8 |7 N2 U! i
bankruptcy, they already have debt financing in place.
3 t1 |, z; @% P, Z6 N; o European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain: j, l% l) n5 ^# q7 q1 n/ j% G3 u
today.
- i8 \1 k$ o+ Q1 T# R5 E: E1 L2 J Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
# z) g2 ~! k2 a0 p/ zemerging markets have no problem with funding. |
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