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发表于 2011-9-17 13:16
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Current situation4 J- J! B2 U$ W5 f5 z$ d; A
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long% p- d) o7 a! J8 }7 e" e; q8 N
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
! k9 m5 R7 P) w9 Dimpose liquidation values./ \; g1 b/ i* n2 m
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
2 Q7 Y) q1 F! _1 MAugust, we said a credit shutdown was unlikely – we continue to hold that view.. s5 e5 [* d, P5 Z
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension8 f: c$ p, r; @$ @! }
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
/ A& Y1 ]+ H0 ?4 F! J- S# { e9 Y8 N
6 @& G# p7 [5 j. \- y) K8 ]: U* iA look at credit markets
( z5 t* _" z/ m5 e% z" q Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in; ?- \3 d" X! h: g2 h
September. Non-financial investment grade is the new safe haven.
# P5 y4 p) X0 k# z" m$ P% ]4 n7 X# i High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
3 ?( z7 K8 P$ c& X \then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
3 F" l- }4 V; j+ n3 v& Wbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
9 R, ?5 m7 k; l0 P: a( F: Haccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
1 [1 X. m$ P2 [0 I' H' TCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are/ T& v* M3 d/ H4 |1 _
positive for the year-do-date, including high yield.- d! P& D# u# h" { m9 D
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble0 h$ S8 w) x0 s( D- [& J% @6 n7 ~8 v+ i
finding financing.* C* V- m4 _6 ^8 E0 K
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they8 @& M% |6 }9 W3 c) d6 d
were subsequently repriced and placed. In the fall, there will be more deals.
% |7 k. F5 r4 | Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and) w2 c( d2 t; q ]2 {
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
3 L1 a. f* p5 \5 rgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for1 `1 S7 G; ^! q3 ^
bankruptcy, they already have debt financing in place.
( V8 P) m, ?5 l2 a" U3 P5 l" v European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
! M% {, X& b( Ltoday.
* @2 G! b, b7 V7 D% w$ ? Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
: _$ I6 }6 o1 d: W) y, Kemerging markets have no problem with funding. |
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