Nomura's Richard Koo explains what he believes is happening in America right now, namely dealing with a massive balance sheet problem. ie: A company may have cashflow, but its balance sheet is under water. He says that executives recognize this, so even at extremely low interest rates, they choose to save money and pay down debt.
On it's face it shouldn't matter if a few companies are doing this, but he points out that if everyone does it all at once, it changes the game. And he
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