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发表于 2011-9-17 13:16
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Current situation
+ N2 \! m4 i+ F& ?& B The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long2 B7 T# d5 R7 R7 v+ C
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may$ f5 s" a/ B, `( N: U& x* r# W$ E
impose liquidation values.
( `7 L/ z# [1 d2 j2 { In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
6 M' d6 o H; F1 lAugust, we said a credit shutdown was unlikely – we continue to hold that view.' S/ u. Y$ W- g7 L/ e
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
/ I3 q% d$ }6 Hscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
( h$ I6 O1 v8 T* k' _' [$ z- K# o& k; v0 ?" M) F, s. B+ |2 J0 N0 Y) _
A look at credit markets( {6 U3 g3 r7 Y$ v, c
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in8 d: s D& }1 |/ `' {5 O
September. Non-financial investment grade is the new safe haven.% Y0 r: D4 r+ c5 a( o+ S+ K
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%! R0 [5 J: D+ Y( T, u
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1# u% u' i: A6 N% F
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have' m1 O& b5 Q6 M( B2 j
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
2 t. S4 o9 \! q8 J D7 x+ pCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are6 V) I3 T, R% o+ C! Q; b
positive for the year-do-date, including high yield.
- y0 b5 U7 [( N# k6 d9 Q: T' X Mortgages – There is no funding for new construction, but existing quality properties are having no trouble& ^/ l7 v' G$ i! t0 x
finding financing.8 e# b' B6 s- f8 p* J A
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
`% v! ]" c( L' [" @# ewere subsequently repriced and placed. In the fall, there will be more deals.; k8 V' g0 b# s( K
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
7 z/ P( @. K) F) g% W3 ]is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
; J) v; {3 {' g8 |- p0 N3 F" w/ T& agoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
; }- c; y0 D' Ibankruptcy, they already have debt financing in place.
' i! \& l) `) F6 X- v4 ]% Z European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain" p, J! _, n# _7 F& s, S, Q0 X* s
today. p$ k5 U7 y( E( s! r0 k; X
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in2 ^2 ~( S) c/ O( @, u1 T1 B- N
emerging markets have no problem with funding. |
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