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发表于 2011-9-17 13:16
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Current situation
9 e; v) d3 R' ^2 J6 p0 I/ t0 |+ ? The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
2 G, o5 a( @. u) Cas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
\* H; c* v* S; _2 gimpose liquidation values. _. a7 m3 @- o2 i
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
4 J9 E O3 a0 e" \2 e0 h+ E$ uAugust, we said a credit shutdown was unlikely – we continue to hold that view.
/ s/ l! v8 C6 G& [5 L9 {6 e The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension! c. S; h2 F& ~& a
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.9 {: H' o) n/ L8 _: w. g
l2 y: K! a! SA look at credit markets( h; r' H# `2 ]! W5 V3 o5 v% x
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
% T, b/ ?5 \$ P4 tSeptember. Non-financial investment grade is the new safe haven.
0 ]" t& f+ S x: x' a High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
% ]5 M, B: v# jthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
& @* q, h7 X; U Pbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have' t5 [" p `: n2 g. O% F$ ?
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade; x+ v* \! e! C, m& m
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are1 p: W j4 ^5 ~3 o
positive for the year-do-date, including high yield." @3 e) a% G. m0 b( P
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble* I4 N1 E s; e- G/ I1 p
finding financing.2 k% `4 q# ]' r7 x2 M6 I
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they* d6 {7 L5 `0 x- _
were subsequently repriced and placed. In the fall, there will be more deals.$ L- M7 R6 K( T
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and7 S, k" z7 S* e8 o* s+ w
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
3 G! V+ {) i! |8 Ogoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
+ t5 j# w8 Z: _, G: @bankruptcy, they already have debt financing in place.
) {! ~; p& M: G- @ European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
: O3 L% f* L+ j' P/ k1 _! v0 e# etoday.9 l* V; p: G: e" @' G6 O
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in+ j* ` m4 K: T) z* T
emerging markets have no problem with funding. |
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