At this time, many companies issued bonds even though they could
not afford to pay the interest expenses.
Today, such a company gets nicknamed a
“zombie.”Such is when a company must feed on cheap debt to stay
alive. Currently, the market capitalization of these
zombie firms is at a record. The obvious problem is what
happens if interest rates rise to a level where they cannot
refinance their debt. ~
Kailash Concepts
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At this time, many companies
Posted by EdZ on 21st of Nov 2021 at 12:28 pm
At this time, many companies issued bonds even though they could not afford to pay the interest expenses. Today, such a company gets nicknamed a “zombie.” Such is when a company must feed on cheap debt to stay alive. Currently, the market capitalization of these zombie firms is at a record. The obvious problem is what happens if interest rates rise to a level where they cannot refinance their debt. ~ Kailash Concepts