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发表于 2011-9-17 13:16
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Current situation
- z3 e& x. {6 [+ e6 [ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
1 _- r# X% ?' _" q/ ]; Y7 Gas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
4 J7 Z" K8 ~% q! C. Y5 Cimpose liquidation values.0 b+ C3 v& ~: [: U$ K% f) ]' q
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
% _! ?: v y* B" C. k0 j0 bAugust, we said a credit shutdown was unlikely – we continue to hold that view. g2 a! b$ _2 U" K8 \; \* t) F- f
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension0 `- q& _7 r0 A! y
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets& k3 a; a+ K) K3 l# e
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
0 l: w( D, p5 Y; lSeptember. Non-financial investment grade is the new safe haven.
7 j. M3 y' c: W3 X- _ High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%" W( t2 J3 H' r( t- O$ Y! X5 l
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
" ^( q' i' m( _- d% O0 Gbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
( |9 h. @7 B9 m" s) x4 [access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
, @3 Q$ E2 P9 j* m. W0 ACCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
9 q5 l7 |' n2 Y n: y# ]2 q- J9 cpositive for the year-do-date, including high yield.# q) Z# u, A- u5 f2 r) W
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble8 Z4 m9 y- P& O8 b4 N! b7 j$ M& B
finding financing.1 K! @9 y4 H+ L: o$ S @
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they; B3 U/ v& B- p& X. `/ T
were subsequently repriced and placed. In the fall, there will be more deals.
. b/ b$ u" i) Q5 m/ S8 E Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
, [4 S2 S- K0 r6 b6 z1 dis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were `' W6 K8 a( f* `7 [- i
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for' o! K% e ]- L
bankruptcy, they already have debt financing in place.: M8 `& i; U* \5 a& ?4 r7 {/ ~/ `
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
& ~. j. P% _+ L8 @! s3 I mtoday.! P2 g; d) b z
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in9 e2 X" e# b$ I+ _' t8 w
emerging markets have no problem with funding. |
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