Just in time for President Obama’s reelection campaign: More than $700 billion in risky, high-yield corporate debt will come due in a three-year period starting in 2012. These “junk” bonds will come due in a year when the U.S. will need to borrow $2 trillion to cover its budget deficit—raising fears that businesses will not be able to get new loans, setting off a wave of bankruptcies. The numbers are worrisome: Junk bonds, valued at only $21 billion this year, will mature at a rate of $155 billion in 2012 and $338 billion in 2014. “An avalanche is brewing in 2012 and beyond if companies don’t get out in front of this,” said an officer at Moody’s.
Read it at The New York Times
