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发表于 2011-9-17 13:16
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Current situation, I& G4 y6 w' t5 w
 The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
* R. d* c4 ~4 h2 Y u7 vas funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
v) t! ?5 d8 y3 K5 Zimpose liquidation values.
Z2 i+ D) \) k6 p- i In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In4 G9 u% ^8 \: d6 a: z) S
August, we said a credit shutdown was unlikely – we continue to hold that view.
7 n: {' I: ^& b5 V1 V! Y/ E The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension) q- L2 y# m+ G( G+ I5 ?: g
scrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.3 H0 |+ ^0 Y! z* {
3 q" W1 \+ E9 x) ^' a* G
A look at credit markets
0 m. C, f1 D0 S7 j# w Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in( z1 t5 _' Z& g- Y6 L0 n6 y
September. Non-financial investment grade is the new safe haven.
3 J. D |5 c9 x" B High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
1 T* j9 ]) F$ y$ ?then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1# u* y% }; Z4 n4 @6 ^* d
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have. D9 e. |2 a0 Z: x9 m
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade* i, U' {& r. q$ z5 y9 `
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are: p* |; {1 e) Q( D V
positive for the year-do-date, including high yield./ B' }$ [/ o. J% `2 f8 D- N
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
5 P$ U, [# j7 V' M! R1 B, efinding financing.4 a7 p$ Q1 i" [
 Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they' O6 Y, B/ [! o% \$ h+ i2 S1 R
were subsequently repriced and placed. In the fall, there will be more deals.
4 B. [8 X. O& F k$ ] Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and5 P! S* ~" i7 f$ |( J
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were4 h4 s6 i0 Y7 s0 Q1 u) g4 \
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for8 t% ~( ?6 k4 R$ |% r. _: h" r
bankruptcy, they already have debt financing in place.) j: N( m+ B$ t- y' C- h+ ]/ W9 o
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
% e7 z# e2 O- _9 Ytoday.
% p j+ T( Q* M. e$ o Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
9 t2 N3 |- j3 z" L3 ?emerging markets have no problem with funding. |
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