How Soaring Corporate Debt Could Lead to the Next Financial Crisis

This is a syndicated repost courtesy of Money Morning – We Make Investing Profitable. To view original, click here. Reposted with permission.
Economic bubbles always seem to stare us in the face before popping.
That’s exactly what happened 10 years ago with the boom-turned-bust U. S. housing market – and it’s what could soon happen with global corporate debt…
According to a new report from Standard & Poor’s Global Ratings, corporate debt around the world is massively on the rise and could skyrocket to $75 trillion from the $51 trillion it’s at now.
This flurry in corporate borrowing is being driven by central banks around the world. For close to a decade, they have kept interest rates near zero (or even below) to encourage companies to pile on debt. Here in the United States, for example, interest rates have been near 0% since 2008 up until December 2015, when the U. S. Federal Reserve raised rates a meager 0.25 to 0.50 basis points.

This post was published at Wall Street Examiner by Cameron Saucier ‘ July 22, 2016.