Why Recovery from a Financial Crisis Can Be Slow

June 27th, 2013
in econ_news, syndication

Econintersect: A study in the Philly Fed Business Review claims one reason for the slow recovery from the Great Recession is business debt overhang.

Recovery from financial crises tends to be slow, and one reason for this is the debt overhang problem. The declines in asset values that accompany a financial crisis lower firms’ net worth. If these firms are carrying debt, the loss of net worth brings them closer to default.

Follow up:

[click on box in the lower right corner of Scribd to make full sized]


Debt Overhang: Why Recovery from a Financial Crisis Can Be Slow



Make a Comment

Econintersect wants your comments, data and opinion on the articles posted.  As the internet is a "war zone" of trolls, hackers and spammers - Econintersect must balance its defences against ease of commenting.  We have joined with Livefyre to manage our comment streams.

To comment, just click the "Sign In" button at the top-left corner of the comment box below. You can create a commenting account using your favorite social network such as Twitter, Facebook, Google+, LinkedIn or Open ID - or open a Livefyre account using your email address.

Proud contributor to:

Finance Blogs

Econintersect Website Search:

Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2015 Econintersect LLC - all rights reserved