Mike, The numbers I look at are mostly net of things like refinancing and rolling debt. On a more micro basis, companies like Freddie Mac and Fannie Mae handle those refinancings, yet their assets are growing like weeds, so we are looking up net, net. Corporate debt is up big time, as are bank assets (loans and derivatives), despite the paydowns of some bonds and loans, net net. On a macro basis, NET new borrowing by corporations and consumers was up 925 billion dollars last year vs. $667 billion in 1997, an increase of 39%. Yes, there were refinancings and rollovers in both years, but 1998 saw new debt, after these events, created way beyond the growth rate of GDP or income, and obviously dwarfing savings.
Now what I don't know is the comparitive net numbers from the 1920s. Our numbers, by themselves, scare me enough that I don't need a 1920s comparison to want out of stocks.
I don't know which numbers John is using and, once again, I don't have any idea how they compare to the 1920s. I was fairly young back then. <g> |
