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发表于 2011-9-17 13:16
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Current situation2 a3 x( a- s4 _+ I6 v+ u) B5 F
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long' d4 N& I8 V0 g) B4 C6 ~7 [/ `' Y# U& c
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
B$ b; M9 H- P3 gimpose liquidation values.+ i% E% @: z- \
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In8 `: q( W3 _% s7 I* e8 H2 B
August, we said a credit shutdown was unlikely – we continue to hold that view.' S- |6 O6 L4 [( u. N0 z
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
3 c7 u( D" o. n( o* yscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.0 c9 I5 m1 G/ M/ i" N3 b$ F/ @
" n, a% Y6 Z7 d/ g) o' k; g
A look at credit markets
* p- J2 \( K4 L1 H; W5 y Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in- m/ O$ W6 c2 w/ I3 g8 H* a' d6 |
September. Non-financial investment grade is the new safe haven.$ P/ P- @9 O% L9 l! E9 f- ?$ |
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
+ e. x, I. _) b) T( S6 a" P% othen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1- ], q; g3 ~& e5 Y7 |9 Z1 v' W4 _
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
- a( \5 ~1 h8 L8 t w3 }access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade2 c: Z/ _8 B& a* ` I# L
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are7 k6 b; S$ m! U5 X- _. ]# d3 J
positive for the year-do-date, including high yield.
5 T0 R! O9 H1 r9 G* M Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
& a. k! o7 r+ q8 ^finding financing.
: t: ]% Z h) X- Z# H6 n/ f Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they# ^* J% i+ j. w& F6 W
were subsequently repriced and placed. In the fall, there will be more deals.
4 u* [/ u8 g- _, Z4 g5 ?% ~6 y( k# E8 K Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
+ `4 q ^$ f! D6 f; H' Gis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ U! c/ a/ Y) s+ E* L
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 y7 _1 Q1 ~; @+ {1 G3 `. R/ G
bankruptcy, they already have debt financing in place.9 n% S M3 S" t+ l: L
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain* n4 Y4 }3 R: \: y c- z0 f+ S
today.8 M5 e0 ^4 D! U; t) f+ S3 w
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
2 e5 @! t' D$ F+ Wemerging markets have no problem with funding. |
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