There’s No Sugarcoating Corporate Debt

If you are looking for reasons to worry about the stock market, few things beat U.S. corporate leverage. Excluding banks, which have very different dynamics, corporate debt has never been greater as a percentage of gross domestic product.

The following chart comes from Deutsche Bank AG chief global strategist Bankim Chadha, who last week attempted in a report to show that the corporate debt issue had been overstated. He makes some very valid points, but it still appears we should be concerned about the debt that companies have taken on while interest rates have been historically low.