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发表于 2011-9-17 13:16
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Current situation. B. |8 H* X5 l! f( I# \+ ]
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long( n9 f7 g e6 b/ T6 e' @
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may- a+ J' ?# Q3 ~) v" V* |4 C2 f5 |$ a
impose liquidation values.( E* v( ~2 c: K0 q7 z
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In3 x4 P* z0 r: [$ C: n' Q. C. H6 l9 V
August, we said a credit shutdown was unlikely – we continue to hold that view.5 n/ W4 c3 l4 i& z. j2 O4 B, A
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
0 k! O- H* x0 t5 F7 wscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets+ [4 x8 i) H; y- [! K% F7 p& K
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in s4 U& `1 o: ?6 i
September. Non-financial investment grade is the new safe haven.
( h0 a. x6 t. n( `* }9 C7 O" U. L High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%+ \' t9 ?2 P2 M
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
# i, A. |5 U7 P2 r. ], a( X' y. Dbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
( W. G( k6 d. I3 R% P. A$ Gaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
: {9 W8 y% q+ i7 y; ICCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are; ~/ o2 A0 I( K
positive for the year-do-date, including high yield.
3 [6 t) ? z) d2 x Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
( |9 W1 i! V/ U7 k7 \finding financing.
: a. r% m( h8 w% P Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
/ y) w, A( b2 e% @: ^# @, b. N/ cwere subsequently repriced and placed. In the fall, there will be more deals.
; _! [& Q+ @2 U$ W6 e4 S& W/ J1 u+ Y Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
- T1 b+ Q3 V3 ]# @/ Fis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were) [2 J0 F6 D" q- P( w) E6 n
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
0 N" H9 R& T* h+ fbankruptcy, they already have debt financing in place.
3 y: O: V' m. }- U European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
) _% P* `- A$ O; b: a+ j; ztoday.
- s/ F: M8 z2 J$ y# N Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in9 r( ~0 e4 R7 L. M% @) g
emerging markets have no problem with funding. |
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