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发表于 2011-9-17 13:16
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Current situation
% m; Z2 s2 z' u# U4 q The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
5 L) Y4 @% r [ } I, Nas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may/ C3 w7 D/ G! z4 y5 o
impose liquidation values.% q4 j- I% ?1 h8 M& J" j# s) {3 i
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
0 u/ A l5 D# e" I: E2 xAugust, we said a credit shutdown was unlikely – we continue to hold that view.
' C3 A1 O4 P0 D The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
% w! n' d# }+ M' r* H; G' d+ x' c7 yscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets
" u- `: r. }# }4 z- N7 E Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
) U* A7 ?! f* _+ \September. Non-financial investment grade is the new safe haven.
[8 e# U* d- _' {0 } High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
) Y$ y, M" a4 l$ Ythen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1( L7 W ~" x) V; c; l' u i
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
* d1 {6 w$ u+ |" n( d+ `. Zaccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade2 A9 m) ?% `" `% n. H
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
* d/ F; L/ ?2 @0 _positive for the year-do-date, including high yield.
! L7 `( R. N: m; Q Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
. k5 }& C7 U! Pfinding financing.
5 N2 ]! m$ `' h/ c, V& Y Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
8 g. X, Z2 C+ q7 Xwere subsequently repriced and placed. In the fall, there will be more deals." j9 G7 ]& f! R4 h) @, ^( s; u6 g
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and5 P3 H7 R- O! z" C( K3 h
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were: o/ |, ~5 F8 p. a1 z }
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for: @ E2 Q/ \3 y: m0 ~2 C
bankruptcy, they already have debt financing in place.
1 |% \" d; m$ Y9 b European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain( v/ M/ d/ Z. L+ L
today.# N2 }4 B5 N$ X
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
6 m# e/ a" v7 B* Y' Demerging markets have no problem with funding. |
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