Corporate Debt

Corporate debt surged to a record 47% of GDP in the 3rd quarter of 2019.

Image.png

  • Source Federal Reserve Board, Bureau of Economic Analysis

Some argue corporate debt is a requisite for economic expansion. Others argue its a sign of too much leverage in the system.

Regardless of what direction the economy takes, you need to proceed with caution when deciding to incur more debt for your small business. The text book rationale for determining if additional debt make sense is:

The increase in profit (not revenue) as a result of the debt must be greater than the cost of the debt (i.e. interest & fees).


While the rationale makes perfect sense, the calculations aren't always so easy for extremely busy small business owners to evaluate. If you find yourself looking at cash-flow loans as a temporary solution, but something in your gut says to think twice, give me a call and we can chat for a bit. Maybe additional borrowing for your company is a no-brainier, but maybe it's not...

If you already borrowed capital and are beginning to feel an inability to pay or facing any business payable issue at all, call Sara Casino at 1-877-700-3010. Ms. Casino manages the PRG settlement negotiation team.

WE ❤️ SMALL BUSINESS

Pacific Resources Group of Companies LLC | 1-877-700-3010 | 151 Kalmus Drive, Suite C225

Costa Mesa, CA 92626 | www.pacrg.com

Virtual CFO, Macro EconomicsJoseph MorinComment