A $10 Trillion Corporate Debt Bomb Is Waiting to Explode the U.S. Economy – By Brendan Cole (Newsweek) / July 29 2020
Even before the pandemic reached its height, the IMF was warning in January that the world’s largest economies like the U.S. were unprepared for a slowdown.
Fast forward half a year, with millions of lost jobs and thousands of businesses gone bankrupt in the U.S. because of the novel coronavirus, the word slowdown is inadequate to describe the scale and speed of the economic collapse.
And the pandemic could yet throw another grenade at the economy: A massive corporate debt explosion.
The American economy has lived on debt for a long time. The ratio of the total debt of the government, businesses, and consumers relative to GDP has more than doubled since the 1980s. Record-low interest rates following the 2008 financial crisis further swelled the debt significantly.
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