 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation/ r) D; J. \) z) @9 e
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long4 ~ a* W, ]9 N& K
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may2 f- Z+ _: m4 _8 N& v- u
impose liquidation values.
. `: t4 |. V) X In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
+ C2 j3 r4 z1 Y8 V) N5 LAugust, we said a credit shutdown was unlikely – we continue to hold that view.1 s/ R7 B4 x0 J2 x! S" ?
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
8 i+ l6 Z; b+ p$ T" M& l& K$ @scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.# Y V B" g- h7 V" V/ p
9 R; P% d1 V- ?0 P; QA look at credit markets9 K5 s6 C( _4 q; ?" s
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
1 x1 A1 Q( `6 `# ^8 l/ sSeptember. Non-financial investment grade is the new safe haven.
+ ]1 q$ p; a2 x3 O$ C; a3 @ High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
+ l6 S, i3 E' V2 ?3 v' a; V! rthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1% [, }. \ w* D7 u
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have0 j- I6 \' Y0 ]% Y
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
+ X' |# O; r- b& e/ MCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
& ]3 J3 l% Z V: f- ^$ `( Z* R" {positive for the year-do-date, including high yield.
/ N* K* _& l: E+ W3 F$ {) e7 i Mortgages – There is no funding for new construction, but existing quality properties are having no trouble# w2 h" B/ ^" n" l
finding financing.
' }' y+ c5 C9 ] Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they& F; r X- u2 C4 |# j
were subsequently repriced and placed. In the fall, there will be more deals.
/ C$ N) O' \/ ~( E! V4 V. |4 i Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
* A* {/ f3 d! d% ]5 C) U8 b/ [is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were+ \/ U9 B- \& U1 n1 s
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for5 F* K* b/ `& {
bankruptcy, they already have debt financing in place.
9 A3 v$ I7 k! i) c. U European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain# C- o) S) _4 x# [
today.
. \5 i: G6 Q! b9 {0 ? Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in) X q* u0 a, V: T
emerging markets have no problem with funding. |
|