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发表于 2011-9-17 13:16
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Current situation
# l" g! `' G2 r# N" @* R) _ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long2 c. `8 n" q5 _4 U: D: V
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
6 a4 w9 A: z2 [2 j/ q% s$ fimpose liquidation values.
# @6 \6 \# Z/ c9 f' s In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In( p; V$ Y% v+ w* j$ R
August, we said a credit shutdown was unlikely – we continue to hold that view.
: L7 N. E& u2 K; k: i' b6 ?! o3 Q The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
" b* r$ U/ s& E# sscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
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) i/ H; K) D# I0 {/ v' xA look at credit markets' w2 {) h$ b& B% ?0 s9 W
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
( A5 U+ E% z5 C# k: E! U" xSeptember. Non-financial investment grade is the new safe haven.- ], O1 d# p T5 s( N" G* P
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
' o, I) k& `* s6 h' Kthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
5 J9 t# s$ ?" x/ H4 j5 {billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have4 @9 p* |$ C4 S0 o2 A: g( _
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade$ W, O. K$ x; E
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
, a/ [3 A( X- _- n6 `/ s8 Opositive for the year-do-date, including high yield.
' f- v" a- V/ S& c6 k- _& m Mortgages – There is no funding for new construction, but existing quality properties are having no trouble" y j- w3 V4 u, k3 Y
finding financing.
- d. f6 L2 E$ f& T Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they! A4 w [: \) y$ d! m
were subsequently repriced and placed. In the fall, there will be more deals.
$ P, n& O b% m+ O, S Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
! a7 n/ ]6 m3 |; U# I- Kis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
4 n9 N: [$ w2 e6 n {& ^, k8 Qgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for( \" }3 a8 e& G6 X+ O5 t
bankruptcy, they already have debt financing in place.( q* F% ^7 E+ E1 j5 b
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain$ ?- r! n. J* Y8 H
today., D6 F' o6 I a/ E
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
: `; S3 ~% Q* X7 }emerging markets have no problem with funding. |
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