From the peak of leverage before the great recession Q3’07,
non-financial corporations liabilities grew 37.4% through Q1’15. For the same period their equity grew 29.4%.
Liabilities to GDP: Q3'07 1.12 Q1'15 1.27
I am just dismayed that anyone thinks there is less risk due to deleveraging.
Well, who am I to question the ROI on corporate
decisions? Profits have been stellar so I guess corporations can grow out of their debt.
The place that deleveraging actually took place is with the banks and non-bank financial companies. And this was a financial crazy products crisis. So who am I to question what liability levels non-financial corporations should have?
Note that the economy as a whole continues to plow money into R&D. And this chart is adjusted for inflation.