Corporate Debt

Ten years ago, Lehman Brothers collapsed in a pile of overextended debt that could not be sustained by a weakening housing market, stock market, and many other bubbles. It would later be called the end of the “housing bubble” as a general panic ensued over the asset most commonly held by the general public.

But the issue at hand was, more generally, a debt crisis which fueled an unsustainable rise in asset prices in many areas. Banks were caught with more liabilities than assets as loans that should never have been made defaulted.

Today, banks are more wary, especially of consumers. But corporations have been racking up debt to a level that many feel is unsustainable.

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