 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation' }! p8 {4 @1 Q5 Y* N
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long2 A+ o* b N( o+ `" F9 V5 Y
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
* d5 K8 J: Q' ]( yimpose liquidation values.
0 O. \; e/ ], G* A; o4 S In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
3 C2 z* Z/ O, p% G6 l0 {7 h6 a8 xAugust, we said a credit shutdown was unlikely – we continue to hold that view.! Z/ a, ~( o' }! L1 S; [2 a, N
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
1 m( }7 {- ~6 c' O9 e& [scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.6 F" H+ K; s& f# i+ y/ B; O. A% W' f
* \' k" I' r6 N* p5 p
A look at credit markets
" I) U1 }( {1 `; E# M. x" _7 [. Y( G Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
) }6 m+ X$ d a$ J6 A- C0 J4 bSeptember. Non-financial investment grade is the new safe haven.( I' q7 y$ X( y7 ]
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%" e- n- n# N. D2 O1 R
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1" X( o' s5 l1 [* Z/ W
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have( }5 y; L( X2 z. F6 D+ p6 L# M
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade: D9 ?; V& Y9 [/ k: J7 ]
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are. B# P% }4 d" t/ N0 _' v
positive for the year-do-date, including high yield.
% l# E: T, Y( F$ n Mortgages – There is no funding for new construction, but existing quality properties are having no trouble! C) u1 i' F1 n$ H
finding financing.3 {4 V, \4 X% O: U3 w
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
7 a9 D$ r M7 k2 G1 Qwere subsequently repriced and placed. In the fall, there will be more deals.% A, S2 v# d) C8 u
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
5 f! }. l& K/ e5 eis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
! \4 C: X6 G, R4 I/ r0 L$ kgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for8 E! \! i: {, W$ T& T, W, r, g
bankruptcy, they already have debt financing in place.& k- F- E! k! S( J/ P
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
' s# C( S7 [0 d; d* ytoday.
; | v7 a n3 T/ V# T( {* J Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in$ M) f" ?- l0 h$ ~1 j
emerging markets have no problem with funding. |
|