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Zombie Companies From Bad to Worse
Zombie companies are businesses that can't pay off their debts with their earnings. Jim Grant thinks these companies might face huge extra interest costs, like adding up Germany and Japan's economies. As interest rates go up, it could push these companies into trouble and cause a recession.
Watch more of this short video from Expect Gargantuan Stimulus When 'Something Breaks' Under Today's High Rates | Brien Lundin.
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There’s no doubt that it's a very challenging time right now for the average investor. Above and beyond the recent economic impacts of COVID, the new era of record low interest rates, runaway US debt and US deficits, and trillions of dollars in monetary and fiscal stimulus stimulus has changed the rules of investing by dangerously distorting the Dow index, the S&P 500, and nearly all other asset prices. Can prices keep rising, or is there a painful reckoning ahead?
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