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发表于 2011-9-17 13:16
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Current situation0 E7 } F& ^+ q; d
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long# }6 A7 u/ B! Z5 P( V; V
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
' Y" j: s. r$ }; k6 r# M+ F% dimpose liquidation values.
1 x. @. U0 a4 E2 b; n" L In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In) q7 b" g' Q. h& O0 C! n: A
August, we said a credit shutdown was unlikely – we continue to hold that view.9 n! x W% o4 v" Q" b
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
' ]: q: P* `1 Cscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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A look at credit markets+ \8 \$ F7 Q' k9 C, i5 X+ x
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in7 I# X) X0 O2 \% v& C/ h
September. Non-financial investment grade is the new safe haven.
# X3 G5 u( j% k9 ^( b6 ^0 v, t High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) s7 h! K8 f$ f7 L% J
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
- U# ?5 s t$ o3 _billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have
+ H9 O9 M+ W4 T2 m K( S1 Paccess to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* K' H2 }) ^/ Q+ S# C: `; {" M
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
/ f; a4 c7 D0 v" Upositive for the year-do-date, including high yield.
/ [! \5 M/ B1 z& E Mortgages – There is no funding for new construction, but existing quality properties are having no trouble" @3 m* `$ S- A# ?
finding financing.: z+ b' L. `5 I0 j, ]# Z0 C
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
' @" E' V6 @/ H4 H0 vwere subsequently repriced and placed. In the fall, there will be more deals.+ i1 a: `% H* C7 r( e ]
 Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
( S6 j$ v+ c! ~& Z2 _, m% sis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
) ~* ?; i" ~0 F; ]going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for/ c5 W/ {4 x8 }7 \( ]" `7 T
bankruptcy, they already have debt financing in place.
[8 C. J P! Z+ g( Q, n European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
4 T z% ~' c7 B; M3 Jtoday.
7 \- u+ G% O* c( `' V: p5 r6 u Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in2 m$ L& z: a1 T( u/ |9 ^+ e, h
emerging markets have no problem with funding. |
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