鲜花( 3) 鸡蛋( 0)
|
楼主 |
发表于 2011-9-17 13:16
|
显示全部楼层
Current situation
" N) a0 m# w8 Y# d2 L The lesson we learned from the 2008-2009 credit crunch is how credit markets affect stock valuations. As long# Y9 C$ \9 u6 k5 W* l
as funding markets stay open, equities are valued as going concerns. But if credit markets close, markets may& v+ A( V0 |" Z1 u
impose liquidation values.
6 @; U- {0 ]. L In the summer, the European credit crisis caused another round of market worries about a credit shutdown. In$ L! x8 N) `. F) O G+ A2 ]
August, we said a credit shutdown was unlikely – we continue to hold that view.- V0 o) l, w5 v$ u |( R( Z6 y
 The collapse of interest rates on 10-year Treasuries to 2% leaves banks, insurance companies and pension
7 c* I |6 W+ t1 M5 ?+ c4 A! Bscrambling for higher yields to satisfy their obligations – this is supportive of corporate bond markets.
$ _6 `1 V; {3 w6 u6 ~) t+ C% c2 K8 R1 E4 Z! `
A look at credit markets( V& u5 f; [4 y& Y6 W2 _7 u) k6 K
 Investment grade – $17 billion in new issues were placed last Wednesday. We’re expecting $80-$100 billion in
: K0 ] C* |, w/ ^( ^/ i5 h$ W) I. ~September. Non-financial investment grade is the new safe haven.
8 h7 _" ]( ~- {! [/ u! }% A0 p High yield – In March, the spread above governments was 450 basis points, today it’s 740 bps. Yields were 7%
, }/ m8 ^7 C; jthen, now they are 8.5%. New issuance has been about $30 billion a month, although August saw only $1
# [' _( r2 L7 s( w( w$ j( m9 A& cbillion. That said, the market is still open. Risk has been repriced – but appropriately priced issues still have# X* b. R' h# G3 `0 e( L0 {2 {- o
access to the market. There are only two parts of the global bond market having difficulty – ultra-low-grade
. O* n/ h* O3 {) M/ n: mCCC issues and European high yield, which are both down about 2.5% year-to-date. All other bond markets are
& A5 L" r8 Z0 p+ o3 z% r: Gpositive for the year-do-date, including high yield.8 Z3 a$ X) z7 L: G% P7 b
 Mortgages – There is no funding for new construction, but existing quality properties are having no trouble
% V% n1 O3 T5 N: Yfinding financing.
$ Y2 p* W8 ^: Y: q Commercial mortgage-backed securities (CMBS) – In the summer, there were two failed transactions, but they
: ^& F! G2 t: S- l4 P; E' Zwere subsequently repriced and placed. In the fall, there will be more deals.
+ C' y; E0 `& n8 B Leveraged floating rate collateralized loans – The index was trading at $90 last September, $96 in March and
" n! A+ H& u+ H- h1 h$ `, |: d3 E9 Bis now back to $90. Changes were a result of interest rate expectations (people thought that interest rates were) r; ~# F6 O' V
going up) rather than liquidity. Chapter 11 companies have no problem getting secured and when they file for
; w' u+ a, ]) `( l' kbankruptcy, they already have debt financing in place.
/ ]3 v. Z' u @1 {! T1 M& ^8 u European banks – European bank lending conditions are tighter. This is the weakest link in the financial chain
0 O; p v7 D+ Z5 j" T+ Wtoday.
# N8 W% k9 G3 K$ U Emerging markets – Sovereign rates have rallied along with U.S. Treasuries. High-grade corporates in
1 x* X9 F/ _( g: u v, jemerging markets have no problem with funding. |
|