Monetary conditions have been historically loose for almost a decade, and that’s been the major reason why the economy has rebounded from the financial crisis. That same stimulus has also formed the backbone of the stock market’s record-breaking bull run.
But it’s also created a side effect that doesn’t bode well for the long-term health of the market.
Only half of the public companies in the US and Europe have the highest possible credit rating, compared to a 90% proportion 20 years ago. That’s because less credit-worthy firms have taken advantage of easy lending conditions for years.
