LIGNET: Zombie Companies Thwarting Economic Recovery

Saturday, 01 Dec 2012 10:28 AM

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Fearful of the financial repercussions of a protracted wave of business failures, central bankers have sought to suppress the incidence of default in recent years, primarily by maintaining artificially low interest rates. This has contributed to the creation of "zombie companies" -- businesses that can only afford to service their debts, paying interest but not reducing their principal loan amounts. These loans clog up the financial system, masking the true condition of banks and denying growing businesses access to credit. This is likely to extend the recession in the United States and the United Kingdom and result in a "lost decade" for their economies.

To read the full analysis from top experts at LIGNET.com, click here.

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