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发表于 2011-9-17 13:16
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Current situation
6 N# f' Q. i8 s# P) V! |* K; ^ The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long
# i& E& q/ A. i" j; e) ras funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
" c& |' c4 }( aimpose liquidation values./ Z0 W6 ?& c0 ]3 Q6 j8 m4 N
 In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
1 f8 _. Z8 {. u! X0 B0 J4 D5 ]August, we said a credit shutdown was unlikely – we continue to hold that view.* i: X9 ]: ^# T; l) @5 X
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
( c; c/ v) \- C6 Hscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.) k; s9 F! s5 w# u! u Y
2 o9 _6 e9 [4 G2 o# QA look at credit markets* g3 f% Z9 e! N+ L3 G
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
. M. A/ }# [4 [1 c! GSeptember. Non-financial investment grade is the new safe haven.1 D+ F- D1 ~. E$ Q0 v! U! N0 |2 M
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%) `! \4 [& F. ^3 \/ a8 }$ O( h
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1! M8 k! ]/ [0 U8 B* D
billion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have4 \4 L2 E1 N4 o- }4 K6 w+ H
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
7 c( V7 d$ `& lCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are& r* b' Y# ?7 y# K1 n/ u' `
positive for the year-do-date, including high yield.$ p1 @5 T0 {# T7 A* Y/ P, M; @
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble7 m% l8 O& g0 W; \9 S, x3 ]3 P( i
finding financing.
; B. s- U$ [5 j4 [1 ]2 z, B Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
{0 q2 J5 z! [6 e+ Jwere subsequently repriced and placed. In the fall, there will be more deals.
@4 I* c6 U& H# ^# X% C" L; I9 v3 R Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and) }' M- r6 D0 I8 O7 ^& d. C. T
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
# w( L- k0 J' r+ k: l' Mgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for1 J. ?) [: }# O9 q4 H3 R: v( E. y
bankruptcy, they already have debt financing in place.& o8 _% n( _+ o- a
 European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain4 m8 A3 [+ l+ G8 v; r% ^3 u+ Y
today.
: P3 T B* X0 M* b$ y% l3 @ Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
1 U" u. ^0 A: H" qemerging markets have no problem with funding. |
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