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发表于 2011-9-17 13:16
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Current situation# |* `3 B1 [. L2 R* C8 [
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
0 v% `& p D5 S4 X9 @) d: Qas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
/ N5 u; t, d1 g$ M) L; timpose liquidation values.6 ^! g4 h/ L- o8 @* T8 F. \
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In. g" y, K R% W
August, we said a credit shutdown was unlikely – we continue to hold that view.
0 x# I7 t5 z2 I* x The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
0 _ ~) C* B9 t: l( B+ N0 `' Qscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
9 e" ~; E' @9 t. N" N) O N Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in5 p% ~/ @' I0 ?: [) U
September. Non-financial investment grade is the new safe haven.
& B0 k9 J7 @6 P8 D- \- F( z# H High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
7 h/ f H# E4 p7 E* h4 R) `# dthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $12 D0 D- k/ D9 h
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have% E- E5 s4 L* ]5 B
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
) r1 G# P S, R6 s8 jCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
1 p- ^+ v# m% j4 Jpositive for the year-do-date, including high yield.
2 M. [% ~9 m6 I' Y1 s Mortgages – There is no funding for new construction, but existing quality properties are having no trouble! }8 K5 }& ` x9 t+ A) U
finding financing.
) a+ C! N' T \4 S3 _& T Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
' ?) v' z, j6 q" Z5 ]were subsequently repriced and placed. In the fall, there will be more deals.! q+ D7 |1 I( g' c( {
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and( r4 v5 f7 x5 W, A. I: _; u) ^ @9 \
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were9 n! u& ]7 H- u# m a
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
# R% u3 s: @0 Mbankruptcy, they already have debt financing in place.
N0 T6 K: t' i0 `' w! k' [- { European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain( j: L" [4 o1 x3 M- i* ?' |
today.
, \; [( L+ M8 n( _: z' r2 K; D Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in9 ]* o& F' s8 ?7 z7 C$ _
emerging markets have no problem with funding. |
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