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发表于 2011-9-17 13:16
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Current situation5 T% S0 v# |. W4 s
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long- h* s* }" G# C/ Q) y9 R( w
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
% X3 I) G5 s1 g( bimpose liquidation values.0 P4 k) o( r( ?3 Y" {) f
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
* }! h: O5 h% {& ~$ kAugust, we said a credit shutdown was unlikely – we continue to hold that view., J% S2 ~! u8 @/ f5 o& r
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
: }( F+ F8 F- U* }1 fscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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; i( s" F+ Q, t) h7 C/ ]; F! rA look at credit markets! ^ Q& F i+ U; N8 J1 Z |
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
( S7 F3 [3 [' l6 O& ]/ G6 l9 u- BSeptember. Non-financial investment grade is the new safe haven.
' h: @! N' w6 d6 n& ] High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%& `, `2 ~ t; X( f6 |) t4 m' ]$ _* `
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $19 U3 v. x& `3 s. ]$ B
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have) L; U& P) c+ J6 ~0 W
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade( I4 C8 c: J5 C
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
" J. ~# T) c4 t/ ipositive for the year-do-date, including high yield.' n+ z. t9 j8 Q7 `
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
; D* L. J% K" |7 zfinding financing.4 b! C- Z# V: ~) c6 ]4 @
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
0 j7 M# i8 N8 B$ h* Jwere subsequently repriced and placed. In the fall, there will be more deals.
/ X! n# e7 D; L7 L' N Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
- o: a* d8 a- _4 U0 y- Q% [is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) n* C# H, i, O5 g# O4 Cgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for. M) L* \; d# V8 q
bankruptcy, they already have debt financing in place.
: r/ H+ Y2 v( z' L+ P% i+ y: Z9 z European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
& O7 ^4 G Y6 W* ]( ~3 Ptoday.
- a* U1 h4 N* w6 p2 N6 C( C: } Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in1 \0 p1 b+ M; V( b/ e2 ~
emerging markets have no problem with funding. |
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