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Thread: U.S. Corporations Have Never Been So Far In Debt

  1. #1
    Radical Centrist BigLeRoy's Avatar
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    U.S. Corporations Have Never Been So Far In Debt

    Just another deeply worrying sign about the economy, another storm cloud on the horizon:

    The $6.3 trillion debt binge: American companies have never owed this much

    America is in another massive debt bubble, folks. Consumers are spending like crazy.

    https://finance.yahoo.com/news/consu...210156674.html

    Government debt is ballooning. And corporations have never been so deeply in hock. I guess America really did learn nothing from the massive bubble of the 2000's. And that was ONLY ten years ago. Short attention span, America. In fact, you've probably forgotten what this post was all about, already.

    It was about the Superbowl, right?

  2. #2
    Radical Centrist BigLeRoy's Avatar
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    And here is a downright scary graph showing just how absurdly overvalued the stock market is these days:

    https://www.gurufocus.com/shiller-PE.php

    The Shiller P/E ratio on the S&P 500 is as high today as it was in the year 1929.


    Does that year ring any bells with anyone?


    The only time the P/E ratio for the S&P 500 has been higher was in the year 1999.


    Maybe we should all be partying like it's 1999?

  3. #3
    Radical Centrist BigLeRoy's Avatar
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    Here's a better link on consumer spending:

    Americans are spending like mad again

    And because consumers are spending themselves silly, that means the saving rate is FALLING, of course. In fact, the national saving rate is plummeting. It was doing the same thing in the years 2003-2007, by the way. Just so you know.

    National Saving would be the SUM of household saving, corporate saving, and government saving. If those sound like funny terms, well, they probably should, because right now, NONE of those sectors are saving. They are all binging on debt.
    Last edited by BigLeRoy; 2nd July 2018 at 12:06 AM.
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    Dick with my Buzz...Try DebateDrone's Avatar
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    Low and slow

    Scarred by the 2008 meltdown, businesses and individuals were reluctant to take on risks during the early years of the recovery. Many were still working off the debt from the last boom.

    "Everyone ran for the proverbial economic bunker, and it was hard to coax them back out," Zandi said. "People were shell-shocked."

    The absence of explosive growth and problematic inflation meant the Federal Reserve didn't have to step in with aggressive rate hikes aimed at cooling the economy down. Low rates and steady growth allowed the stock market to quadruple from its March 2009 low
    .
    Now what do we have? accelerated growth, problematic inflation and two more Fed rate hikes this year to come.

    During the 1000 point correction a month ago, money people were saying ..don't panic, don't panic but diversify. Meaning...don't panic don't cause a run and sell high.

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    If these U.S. Corporations are in so much debt maybe they could use another round of corporate tax cuts?

    Yeah, that's the ticket!

  6. #6
    Spock of Vulcan Ian Jeffrey's Avatar
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    Quote Originally Posted by BigLeRoy View Post
    The only time the P/E ratio for the S&P 500 has been higher was in the year 1999.

    Maybe we should all be partying like it's 1999?
    Right before the tech bubble burst and the NASDAQ crashed. I was in the brokerage industry back then.


    (And I hated Prince...)

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    Spock of Vulcan Ian Jeffrey's Avatar
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    Quote Originally Posted by Miller47 View Post
    If these U.S. Corporations are in so much debt maybe they could use another round of corporate tax cuts?

    Yeah, that's the ticket!
    Just like if the government is in so much debt maybe we need tax increases - including especially corporate income tax.

    If individuals should not be rewarded for their own bad decisions, neither should corporations. Of course "they could use," but that does not translate into "they should get."
    Thanks from BigLeRoy, Panzareta and OldGaffer

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    Quote Originally Posted by Ian Jeffrey View Post
    Just like if the government is in so much debt maybe we need tax increases - including especially corporate income tax.

    If individuals should not be rewarded for their own bad decisions, neither should corporations. Of course "they could use," but that does not translate into "they should get."
    Pretty much agree with this.

    Reminds me of the member who thinks Californias $427 Billion debt is not a problem.

    Almost like they should be applauded for being in debt to the tune of nearly $11,000 per citizen!

    Whoopee!

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    Quote Originally Posted by BigLeRoy View Post
    Just another deeply worrying sign about the economy, another storm cloud on the horizon:

    The $6.3 trillion debt binge: American companies have never owed this much

    America is in another massive debt bubble, folks. Consumers are spending like crazy.

    https://finance.yahoo.com/news/consu...210156674.html

    Government debt is ballooning. And corporations have never been so deeply in hock. I guess America really did learn nothing from the massive bubble of the 2000's. And that was ONLY ten years ago. Short attention span, America. In fact, you've probably forgotten what this post was all about, already.

    It was about the Superbowl, right?
    Nothing but a sensational headline. Guess what there will be more nominal corporate and personal debt a decade from now, guaranteed, just like there is more nominal debt today than in 1918.

    Companies are also sitting on more cash than ever, not a good thing.

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    Junior Member Slartibartfast's Avatar
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    Well done @BigLeRoy , you didn't blame trump. I'm quite speechless.
    Thanks from bmanmcfly

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