 鲜花( 3)  鸡蛋( 0)
|

楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
& O k7 e* _' M9 y The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long' |/ S0 I7 t; ]. m' J( h
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may
% H4 e- ^: `; c9 j. L4 G! X0 ?. Eimpose liquidation values.
' o0 u' V A" F) @, a9 e$ f In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In
; W; Y3 N1 {: s |! XAugust, we said a credit shutdown was unlikely – we continue to hold that view." i- j* v$ e3 X7 O; z
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
% y8 d" D- M! l& s' {/ e6 Jscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
$ `, T+ ~) _3 g6 b x
0 W9 j8 h6 }' c* d0 \8 p fA look at credit markets
+ m! m9 ^) P5 C5 K9 e4 ? Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
* w+ X8 v9 S4 ?) m+ g% ~1 sSeptember. Non-financial investment grade is the new safe haven.! x0 m( G( s; [6 C3 p& l5 t+ E
 High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%( R" |5 I g( K, [- A+ R
then, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
/ p8 l2 z _# i# m. Zbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have }0 |4 n& T4 o# Z7 `6 K- o
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade& d# w, f+ v/ Y0 y
CCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
! G9 P, n4 i) ?4 |! V. Ipositive for the year-do-date, including high yield.
( c/ w( ^6 h5 [, z Mortgages – There is no funding for new construction, but existing quality properties are having no trouble( N- m$ m. n0 W# Z" `: l% x
finding financing.
9 h, ?' P H3 I/ M" V4 T7 L Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
: T! ^3 M" \+ ~) |; B2 @, Fwere subsequently repriced and placed. In the fall, there will be more deals.
/ Y/ f8 I% ~( H7 M9 o# a# x Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and4 l3 H& `" V3 H( _! F; M
is now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were
0 ]( A$ o' Y, q& Dgoing up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
4 `- W- F9 `1 Qbankruptcy, they already have debt financing in place.
3 f( \/ p6 x& ?: {9 V& k- c, b4 G European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
: w0 d' \% q9 utoday.+ t) `6 `* {- y- B( H9 Y
 Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in5 y h7 |( r; Z3 o; X
emerging markets have no problem with funding. |
|