Assume, for example, that a disorderly rebalancing occurs because Beijing waits so long to force through the reforms that it runs
into debt capacity limits (i.e. the growth in debt can not exceed the growth in the amount of bad debt that must continually be rolled over).
Not exact matches
A significant share of the corporate
debt in stressed economies is now owed by companies with weak
debt servicing
capacity and this could negatively affect bank balance sheets and cut
into profits, it added.
«We have changed our view of the difficulties in bridging the gulf between the political parties over fiscal policy, which makes us pessimistic about the
capacity of Congress and the Administration to be able to leverage their agreement this week
into a broader fiscal consolidation plan that stabilizes the government's
debt dynamics any time soon.»
The combination of very high levels of
debt and excess manufacturing
capacity can lock an economy
into a self - reinforcing deflationary process in which growth stagnates and
debt rises faster than
debt servicing
capacity.
I have 2 questions: 1) How does the recent announcement of plans to open up the Chinese financial economy to foreign firms change the equation of «control» by the Chinese government 2) How do you envision the scenario where we reach maximum
debt capacity and a transition
into a low growth scenario?
The information collected by the credit bureau and processed
into your business credit profile is designed to reflect the financial condition of your business and its
capacity to service
debt.
The vast stimulus programme launched at the end of 2008 to counter the world financial crisis restored growth but led to wholesale misallocation of capital
into wasteful projects that earn scant returns, the vast
debt problem affecting companies as well as local governments, and also created soaring excess
capacity in sectors such as steel production.
The populace has run out of its
capacity to take on new
debt without going quickly
into default on the
debt already issued.
That was the conclusion of a key Communist Party meeting a decade ago, yet what followed was more of the same: rapid investment - led expansion, which turned China
into the world's no. 2 economy, but left it laden with
debt, environmental damage and excess
capacity.
The lease, if it has fewer than 10 payments left on it at the time of your application, would not be factored
into your
debt to income ratio (this would increase your purchasing
capacity by decreasing your
debt to income ratio).
So if a company is drowning in
debt and has little
capacity to pay it back, its bonds will get a junk rating and they won't make
into indexes that hold only investment - grade issues.
The information collected by the credit bureau and processed
into your business credit profile is designed to reflect the financial condition of your business and its
capacity to service
debt.
As such, we build up productive
capacity using
debt, assuming that high compound growth will make it work, and fall
into another bout of
debt deflation.