Debt is the issue: While the headlines of Valeant’s negative plunge centered on wrongdoing and price increases resulting from mergers, some short sellers who were critical of the stock looked at the corporate debt load with concern. Once the Valeant machine reached a certain negative revenue to debt point, the debt would subsume the organization, was the thesis. With this in mind a new CLSA piece is showing that corporate debt as a whole is set to get much larger – as much as 50% larger – and could reach $75 trillion by 2020, up from nearly $50 trillion currently….
US Corporations Have Lots Of Debt And Not Much Cash: CLSA
Mark Melin
Mark Melin is an alternative investment practitioner whose specialty is recognizing the impact of beta market environment on a technical trading strategy. A portfolio and industry consultant, wrote or edited three books including High Performance Managed Futures (Wiley 2010) and The Chicago Board of Trade’s Handbook of Futures and Options (McGraw-Hill 2008) and taught a course at Northwestern University's executive education program.
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