The S&P 500 (SPX) has declined 4.2 percent since Dec. 29. AFP PHOTO/Stan HONDA
Your feedback is important to us!
We invite all our readers to share with us their views and comments about this article.
Disclaimer: Comments submitted by third parties on this site are the sole responsibility of the individual(s) whose content is submitted. The Daily Star accepts no responsibility for the content of comment(s), including, without limitation, any error, omission or inaccuracy therein. Please note that your email address will NOT appear on the site.
Alert: If you are facing problems with posting comments, please note that you must verify your email with Disqus prior to posting a comment. follow this link to make sure your account meets the requirements. (http://bit.ly/vDisqus)
Underpinning much of the angst is an unprecedented $29 trillion corporate bond binge that has left many companies more indebted than ever. Whether this debt overhang proves to be a catalyst for recession or not, one thing is clear in talking to credit-market observers: It's a problem that won't go away any time soon.While not as pronounced as the rout in global equity markets, losses are beginning to pile up in the bond market too.Investors lost 0.2 percent on global corporate bonds in 2015, snapping a string of annual gains that averaged 7.9 percent over the previous six years, the data show.Debt at global companies rated by Standard & Poor's reached three times earnings before interest, tax, depreciation and amortization in 2015, the highest in data going back to 2003 and up from 2.8 times last year, according to the ratings company. Worsening debt profiles contributed to S&P downgrading 863 corporate issuers last year, the most since 2009 . Companies' debt costs are reaching new heights.
FOLLOW THIS ARTICLE