FYI: Corporations, like people, are pretty simple: They do what they are rewarded to do. So when the Federal Reserve, by keeping interest rates very low for nearly a decade, rewards companies for borrowing money by making it historically inexpensive to do so, it can’t be a surprise to anyone that that’s exactly what they did.
In 2008, in the wake of the financial crisis, the Fed began its “quantitative easing” program, a determined effort to buoy the economy by lowering the cost of borrowing. It bought up trillions of dollars in Treasury and other debt securities, effectively reducing long-term interest rates. Debt issuance exploded. In the last decade, the amount of corporate bonds outstanding nearly doubled to $9 trillion, from $5.5 trillion.
Regards,
Ted
https://www.nytimes.com/2018/11/26/opinion/corporate-debt-bubble-att-ge.html?rref=collection/sectioncollection/opinion&action=click&contentCollection=opinion&region=rank&module=package&version=highlights&contentPlacement=3&pgtype=sectionfront
