The Market Ticker
Rss Icon RSS available
Fact: There is no immunity or protection against The Law of Scoreboards.
Did you know: What the media does NOT want you to read is at
You are not signed on; if you are a visitor please register for a free account!
The Market Ticker Single Post Display (Show in context)
Top Login FAQ Register Clear Cookie
User Info The Simple Facts On Equities And Debt; entered at 2022-09-16 08:10:51
Posts: 4850
Registered: 2011-04-14
Great Ticker.
Corporations basically never pay off debt; they always roll it over.
Let me see if I can get this right. Corporations do not pay off debt because they want to use financial leverage to increase earnings. So, debt is not retired.

In a falling-interest-rate environment that means say XXX amount of debt is appropriate. But, in a rising-interest-rate environment that means say X amount of debt is appropriate. So, the company needs to retire XX to get to where it needs to be when the environments switch.

If the company is retiring XX, then it is not spending on something else. That something else is probably taken from a long list of cost-cutting measures such as capital expenditures, maintenance (lol), salary freezes (ouch),...

Honestly, I would not be surprised at a 50% drop from here to the bottom.

2022-09-16 08:10:51