Re:Businesses are in for a mighty debt hangover
by tunesmith on Tuesday May 16, 2023 @07:40PM
(#35969298)
> This doesn't affect old debt unless it needs to be refinanced.
That's a really big unless. That's the whole point.
Re:Businesses are in for a mighty debt hangover
by MuffinFlavored on Tuesday May 16, 2023 @07:45PM
(#35969342)
How much debt is refinanced at what rate/how often versus new issue?
Re:Businesses are in for a mighty debt hangover
by Panzer04 on Tuesday May 16, 2023 @07:49PM
(#35969386)
A lot of non-government debt is likely to be floating rate. America is somewhat unique, with a large consumer fixed debt market in mortgages thanks to government subsidies, but that's not the norm.
This doesn't affect old debt unless it needs to be refinanced. Only new debt. Plus, interest rates will most likely not be 5-6% within the next 12-36 months.
Will they be higher than they were at 0.25%? Yeah, probably. But isn't a 2-3% interest rate "healthier"? It provides alternative investment options instead of "let's all pile into equities even though valuations are already detached and the entire market is trading at 35.96x (which it was at Jan 1, 2021)"