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发表于 2011-9-17 13:16
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Current situation- _: h; E G2 }# P/ g+ x& ]
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long9 S6 X8 |" ?& a: E) u0 E
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
$ O% p5 j2 ^; Q9 iimpose liquidation values.; A% y; ^" v1 r/ I$ o
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 f9 h9 C& z4 W3 HAugust, we said a credit shutdown was unlikely – we continue to hold that view.
0 F9 ^! ?4 T/ Z The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
C2 g- d- w5 C0 Xscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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, c5 B& ]0 W, k3 Y1 OA look at credit markets
. h; B/ |9 l5 U( J( R Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
; a% L! \8 ?" s' M" iSeptember. Non-financial investment grade is the new safe haven.
+ T/ U" t9 Y/ e High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
3 t4 I, R- j) i3 }then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $15 U: o5 ^; X! t- j
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have7 H9 Q- q6 A' l1 m d3 M
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
0 v( d: ]& w0 q0 Q* \( xCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
6 K# `- a* ], f9 ]; qpositive for the year-do-date, including high yield.
y% q; `, {/ ]4 d& j6 { Mortgages – There is no funding for new construction, but existing quality properties are having no trouble' n" W$ A6 z& H. ^, h$ p/ }
finding financing.
! ` O* w2 V$ l Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they* m$ r4 B; b& R4 |5 q4 o
were subsequently repriced and placed. In the fall, there will be more deals.
5 n Q1 [+ j# v% K4 w6 o- i Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and- e, u# z2 P) r. S6 n; P9 A9 p8 P2 g
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
8 V9 f1 R1 z7 \9 Ngoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
+ n( F; t& s0 R. h0 |bankruptcy, they already have debt financing in place.7 o) P" X& T5 E9 `& _7 ]
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain: j3 x) h7 A/ q7 o8 z
today.
9 V. B: T9 J# ` Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
' r$ S8 a( S/ Y8 uemerging markets have no problem with funding. |
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