The two challengers both agree with each other. Their positions are summarized as the recovery we are in is sustainable due to the excellent cash position of most corporations. They agree that the economy is still mired in debt deleveraging that will last for several years. But the general improvement in the health of corporations will create enough economic expansion to maintain a very low rate of growth, maybe not enough to change unemployment from current levels but enough to prevent another recession.
In his current letter, titled A Fragile Economic Outlook Continues, John Hussman briefly references the corporate debt condition. "While corporate cash levels may very well reduce liquidity risk for companies that would otherwise need to raise funds in a tight credit market, investors should not ignore that the overall debt burden of U.S. corporations is higher than it has ever been." The amount of corporate debt is tracked in the Federal Reserves Flow of Funds data report, Z.1. The facts are that corporate debt is at an all time high.
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