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发表于 2011-9-17 13:16
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Current situation7 G- k0 t6 e/ U, j+ H5 Y
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
9 u& k# b7 s0 y! Ias funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may/ F- A% b$ ?' \' W+ Q: f+ P* R
impose liquidation values.! e- k$ i' I+ R: x( C: X( J
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
! L8 U, l6 K; b) g- z e# |August, we said a credit shutdown was unlikely – we continue to hold that view.
9 T# P/ G1 V( t* C The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
9 ~6 B# o. K9 E z* Dscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
+ {8 f# y M2 B( T( |9 h7 h3 i: y) |* h1 w- J
A look at credit markets
4 `/ } f7 V# t2 G Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in+ _, w% z2 l# r. Q7 n3 X/ w5 K }- H
September. Non-financial investment grade is the new safe haven.+ M# V+ f# ]- ?% Z2 y
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%3 S9 M* t3 j% F- j1 u- p
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
! v! U) u# x& g0 a* O+ Mbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
1 n7 U* ~ W0 i ]1 Z3 S7 g1 xaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
r6 ]! I$ ?$ F! h, N% `+ z4 KCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are( f# W2 ?: E) s5 ?1 Z; ^/ t+ X
positive for the year-do-date, including high yield.
1 w, z# y* \3 x# Z Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
/ u; x: X+ K0 M2 v8 Xfinding financing.; w5 I- c' D& b. x( e* ]! o0 X
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
5 i! }+ y! M3 mwere subsequently repriced and placed. In the fall, there will be more deals.
; I- y, f- ~/ K7 o% G+ l/ u, s# C Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and: P8 Z" i. T. I
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were$ w+ F* G8 O0 P) r6 Q: c5 O
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
2 F- E$ H- ^! Y# {% s" Nbankruptcy, they already have debt financing in place.1 {8 i' p0 w, I# g, ?
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain- [' j# ^" {8 f1 H6 g
today.8 ]( Z0 A* r; ?% Q4 s7 l3 V/ m; h
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
! Y0 f3 G, L" v, R" e3 x% l0 f9 p. _emerging markets have no problem with funding. |
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