How Dangerous Is The Corporate Debt Bubble?Knowledge Wharton
Former investment banker and author William D. Cohan and Jyoti Thottam, opinion editor for business and economics at The New York Times, talk about the looming corporate debt bubble.
Investors often focus on stock prices to take the temperature of an economy’s health. If share prices are high and rising, they feel upbeat. If price levels sink low, so does investor confidence. Still, as the 10th anniversary of the Great Recession of 2008 draws nearer, some experts are beginning to worry that a looming bubble in corporate debt poses a great danger. “The … domestic debt market – at $41 trillion for the bond market alone – reveals more about our nation’s financial health,” wrote William D. Cohan, a former investment banker, in an op ed in The New York Times earlier this month.
Cohan, author of the recent book, Why Wall Street Matters, believes that the bond market is broadcasting a dangerous message. How serious is this risk? Could the puncturing of the corporate debt bubble spark another recession? What are the dangers of mispriced risk? Cohan joined Jyoti Thottam, opinion editor for business and economics at The New York Times, to speak about these questions and more on the Knowledge@Wharton show on Sirius XM channel 132.
Listen to the complete podcast at the top of this page. An edited transcript of the conversation will be posted shortly.
Article by Knowledge@Wharton