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Explosion in company borrowing has created a corporate debt timebomb which could crash the global economy, the IMF warns


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#11 pdx5

pdx5

    I want return OF my money more than return ON my money

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Posted 21 October 2019 - 05:13 PM

The big difference between 1987 and 2019 is......

Fed rate was 7.25 in October 1987 versus current 2.25.

The asset bubble in1987 was a dwarf compared to today.

Shiller PE was half of current value BEFORE the crash of 1987.

The debt bubble is now bigger by orders of magnitude compared to 1987 due to artificially low rates.

Bigger the bubble, bigger the crash.

But there is no way to predict how big the bubble can get before it self-implodes.

Right now it needs a catalyst or a black swan event.

In absence of such event, expect the bubble to get even bigger.


Edited by pdx5, 21 October 2019 - 05:16 PM.

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