GeminiAtlas

Debt-to-Equity Ratio as Fishing Lure

I'm no economist, but my thesis would be that it could be the canary in the coal-mine for high inflation in the mail. The stock market could be anticipating that. I ask myself, "who would benefit the most from inflation?" Debtors, of course. So it would seem to me that companies that are levered up to their eyeballs in debt would have some sort of benefit (or debt-cost avoidance) from the inflating of the money-supply. Of course, the creditors (bond-holders) get their savings clobbered (yet again) because of this.