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发表于 2011-9-17 13:16
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Current situation
4 c7 o1 h/ h4 O2 z* O( ? The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long7 e; k% l& A0 ?7 |+ K7 T
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
/ A. i2 M, a) ?) jimpose liquidation values.
( }! \3 g) Q( c% P5 x G7 D# B9 H In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In6 r# V( J: C0 j* ^1 J0 | d P
August, we said a credit shutdown was unlikely – we continue to hold that view.$ m- o5 C9 ~3 s" o
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension, {% X1 s; Q. n: c3 d. h' t
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.* M- z8 F1 Q! ]
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A look at credit markets
4 i! Z3 ~( v! S& W; i2 r5 b6 x7 J% x Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& w) k0 h6 v1 a/ g9 HSeptember. Non-financial investment grade is the new safe haven.
+ s1 \% T; L9 K' l High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
6 a: u) `+ I" C' Zthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1! Q$ o9 o- W9 C3 z. l
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
+ w& f7 i2 r3 [( m6 n7 t' Taccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade; v! P! V- ]9 i
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are1 y: ~/ U+ p3 s9 K. y9 e
positive for the year-do-date, including high yield.
' ?; ?. K( v2 I Mortgages – There is no funding for new construction, but existing quality properties are having no trouble" d& o& h1 g* u; t9 N. v* D% j
finding financing.' s8 s/ T5 k3 c/ J+ V8 R p, y
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
$ T4 N& F, N# i+ J4 Zwere subsequently repriced and placed. In the fall, there will be more deals.: Z5 I6 k L6 M2 f* x0 o
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
6 B: i/ n0 r1 j+ b& q6 \0 Wis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
' l8 k& I% N5 E0 @7 B3 E& ngoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for4 A) F' k. r/ s- w( `( X1 }
bankruptcy, they already have debt financing in place.
w2 z" y5 d b. J9 R. ?4 t2 G European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain9 U- w. N+ }$ \5 c$ _
today.$ J. H0 z' [5 F7 P2 g) p! |
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in7 Y* u& ]# m" i9 U+ M
emerging markets have no problem with funding. |
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