 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
4 P, A) b7 n) b' I) _' Z# x The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long" r, H& x0 x7 G& Z+ y
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
" c4 h2 e9 M* K& Ximpose liquidation values.' b9 g _8 M L+ O5 C' A
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 Q6 G0 E$ {6 b9 {; n- A' k4 s. XAugust, we said a credit shutdown was unlikely – we continue to hold that view.
& C; v8 l9 E* t& [ The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
% m, q% y$ s Sscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
% Y/ N) y) K$ d% x% I6 X6 V4 u- S' m( @2 [
A look at credit markets1 A$ {! _1 ^! B
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
|9 n, z% x: n- Y. s: _. F# KSeptember. Non-financial investment grade is the new safe haven.
4 P6 c8 H6 o; k* ]4 `* O$ N High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%" U8 K, s* R% i
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
$ ^6 u* G2 `% [/ w Dbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
8 e/ S: C* f3 O: ^* Q5 ^access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
% M( V4 z B7 J3 M# ]' q; KCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are+ e E8 s8 c+ X( N, p) C
positive for the year-do-date, including high yield.
: ^! `! s( T0 D9 t( V+ L5 v1 f" z' U Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
( g) x7 H8 ^. ^4 M1 b: y' i& R1 zfinding financing.
" X, Y% `. g: x Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they3 _- X: J" i1 J; p5 K
were subsequently repriced and placed. In the fall, there will be more deals.2 P" D& P* J! Y, q' |8 [
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
6 q; b) j& s. y O# [8 z0 V6 |is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were! n+ L$ M' R5 S. R: e
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for( S/ R/ X- X/ v0 s2 P0 E
bankruptcy, they already have debt financing in place.6 t( D0 R: E) E8 |% t! d- e
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain! C+ A2 O5 h/ w7 H4 s* b
today.
( j* _3 o) a7 l7 z6 y+ y Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
: D+ a, r! ]* @0 O4 u' Hemerging markets have no problem with funding. |
|