Zombie company?_其他_趣味英语-查字典英语网

Zombie company?

Bond market veteran Bill Gross made these comments at the heart of his latest Investment Outlook, entitled ‘Say a little prayer’.

Gross, who runs the $1.4 billion Janus Global Unconstrained Bond fund, centred his latest commentary on the problems posed by current global debt dynamics and the continued use of low interest rates.

Likening the use of 0% credit as ‘feeding a fever’ to aid growth, Gross said the mechanism had failed to take hold and, instead, had created several detrimental by-products.

‘In the real economy, it seemed almost straightforward: if a central bank could lower the cost of debt and equity closer and closer to zero, then inevitably the private sector would take the bait – investing in cheap plant + equipment, technology, innovation – you name it.’

‘“Money for nothing – get your clicks for free”, I suppose. But no. Not so,’ he said. ‘Corporate investment has been anaemic.’

Gross said negative outcomes from zero bound interest rates were obvious, for example, with both bond and equity investors hunting for yield and moving into riskier assets. This, he said, had spawned a bigger problem for Corporate America.

‘Because BB, B, and in some cases CCC rated companies have been able to borrow at less than 5%, a host of zombie and future zombie corporations now roam the real economy.’

‘Schumpeter’s “creative destruction” – the supposed heart of capitalistic progress – has been neutered. The old remains in place, and new investment is stifled,’ he said.