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发表于 2011-9-17 13:16
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Current situation' X$ Z/ w" e+ [' ]* e0 w& w
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long: a2 n% U, d- z/ ~& r4 h
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may& ?6 \# S F3 |/ a- h( `" i: {
impose liquidation values.
5 h; @( ?: j; H/ I3 S In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! g4 F5 J6 z: _9 T# [August, we said a credit shutdown was unlikely – we continue to hold that view.
, q5 H. w5 } X. W; I+ N1 k7 T6 U0 s The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
0 |& \" l: h. G# O$ iscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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/ Z8 L3 A) L( t& k+ GA look at credit markets
+ a3 c" V& d( m2 |3 O/ | Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
% n- v; X4 y/ \8 C% cSeptember. Non-financial investment grade is the new safe haven.& C& Y) e9 a7 `5 m1 q _" ?/ A
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
0 T6 O6 ]/ e; D* v# W( Sthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1" {2 I j" x! C: }' N. r
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have, T" U4 q2 d) }4 N/ a; D) Z) l
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
8 t3 ~ X1 g2 m! ?9 uCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
$ O4 q) L; z m X- [positive for the year-do-date, including high yield.
/ a8 K6 }( q; w1 g* N: O* l Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
/ u% ^7 }/ o5 m! [) D5 t/ Ofinding financing.( i5 v# J2 \; q4 n: X
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they9 u, ^; {/ b" s
were subsequently repriced and placed. In the fall, there will be more deals.
! V! X# [: ?& }( |5 D, |+ H Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and4 N( W- s3 f2 @; F
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were- t; r" m" r6 g
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for! L& a1 E0 b& r( H& e Y4 ^
bankruptcy, they already have debt financing in place.
1 U% U- w1 m W( v9 X! d European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain, x2 J7 r) r' @5 h" D
today.3 j" @- D3 F& ?7 J9 W! E' T
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
5 Z" d5 ?$ T, P+ nemerging markets have no problem with funding. |
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