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发表于 2011-9-17 13:16
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Current situation7 V; Z, T' k8 \; a
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long. c q$ U: ]! {$ `4 D$ B
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may2 M" T2 {3 `. Y! @3 A
impose liquidation values.' |; L, @) H; T* E, U' D
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In( x$ o0 J, Z8 }6 x
August, we said a credit shutdown was unlikely – we continue to hold that view.
9 P! y) C9 a" K4 ?. v The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension' `% @9 K5 p/ \2 s9 |) s
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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2 e O2 B% h5 p( CA look at credit markets
; ^; k8 |- C: |, U( D4 V Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in+ D9 K+ x2 d4 h1 ~0 X! ?7 S
September. Non-financial investment grade is the new safe haven.
7 _/ v1 W9 o: G High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%+ j' n/ H, G# z% l0 d+ ]& G6 E
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $19 v9 M* u% t1 F6 O4 Z
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
$ x! R- [3 u% v( \! X% a# daccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade3 x9 \3 d$ W' [5 _
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are' z) U! J( p! V9 i M
positive for the year-do-date, including high yield.
. e" _1 i8 M: \; P Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
- H3 Z- m d5 Y. t: ^finding financing.
& V4 J! v( r" F' h Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they6 A; q- `5 B2 g1 s4 g
were subsequently repriced and placed. In the fall, there will be more deals.
7 u3 t+ C, t# ~: {4 V! t) G Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
7 h2 K( {0 |7 \2 t! iis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were7 b# A/ H- O4 P8 H/ M1 `( n- O) c
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
B) n; m' Y7 ^- Ibankruptcy, they already have debt financing in place.. L! ?2 U) p( _7 d j, ^7 B
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
7 k- f$ b! U* Gtoday.5 r9 z7 L& ?+ _( Q
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
# K8 Y- O% z. j. H( e! V* @) @emerging markets have no problem with funding. |
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