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Is There Too Much Business Debt?

Brandon Zborowski and Anna Kovner
Additional contact information
Brandon Zborowski: Research and Statistics Group
Anna Kovner: Harvard University

No 20190529, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: By many measures, nonfinancial corporate debt has been increasing as a share of GDP and assets since 2010. As the May Federal Reserve Financial Stability Report explained, high business debt can be a financial stability risk because heavily indebted corporations may need to cut back spending more sharply when shocks occur. Our bloggers review measures of corporate leverage in the United States and find that, although corporate debt has soared, concerns about debt growth are mitigated in part by higher corporate cash flows.

Keywords: leverage; financial stability; debt (search for similar items in EconPapers)
JEL-codes: G3 (search for similar items in EconPapers)
Date: 2019-05-29
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