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发表于 2011-9-17 13:16
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Current situation$ a3 ~* p6 T$ _- Y$ L! U
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long( F5 o% S8 p( l, K, G$ ^# [+ z" P, T
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may: A% A# k$ J3 V5 e+ V# N
impose liquidation values.) D: @* A% W' z; Z: u+ e' c
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In% ]: [' G) A6 R+ p
August, we said a credit shutdown was unlikely – we continue to hold that view., w: {2 i' q& a1 r9 y) Y& w
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension% }* J/ ?" y" ^+ L
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.. l( Y" j0 Q5 P \# U) R
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A look at credit markets
+ I5 k7 ]8 d: |( {* x# Z Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
& e9 G- n+ V! ?2 V) ]9 `$ XSeptember. Non-financial investment grade is the new safe haven.+ w1 p# f8 n- N. a3 j( O
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
- o! r2 o1 o: ~then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
2 H4 z: B" S u! |, P) v- }* qbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
: n6 ]0 w& W4 k# V) ~' qaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade3 L3 ?. u' F5 d+ u1 j. ?
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are" P6 Z4 h. E$ G) F2 `; D7 V+ r
positive for the year-do-date, including high yield.
5 o! W6 j2 G. ~; d2 e' r Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( J* L, y4 u2 P" m4 q0 }0 B
finding financing.
* r6 S, ~* u+ C* n5 Q Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they! P0 r; d- L8 C% p3 Z" e
were subsequently repriced and placed. In the fall, there will be more deals.* H) n2 c; M) V. P8 }' Y1 ]
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
7 Q3 m3 U; w& Wis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
7 L: o, q$ O, u" c4 ~$ wgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
7 h" p$ E) X+ L9 ubankruptcy, they already have debt financing in place.+ q+ H0 c6 h' ^
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain; G& K; P% Q. z2 `/ n5 U
today., A! T h" {( Y1 ^. F
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
8 H7 I9 N6 V Q5 d4 p, v' femerging markets have no problem with funding. |
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