Stealing From Peter To Pay Paul

This should tell you something. According to the Wall Street Journal, companies have issued more than $72 billion worth of speculative-grade loans to pay dividends so far this year. That is already a full-year record in data going back to 2000, topping 2013’s previous full year high of $54.4 billion.

Indeed, “full year record” is hardly the word for it. In the year 2000, total junk loan issuance to pay dividends was was just $4.08 billion, followed by $4.04 billion and $3.09 billion in 2001 and 2002, respectively. So the estimated $100 billion for the full year 2021 is from an altogether different financial planet.