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America’s zombie companies rack up $2.6 trillion of debt

WASHINGTON (BLOOMBERG) - They were once America's corporate titans. Beloved household names. Case studies in success. But now, they're increasingly looking like something else - zombies. And their numbers are swelling. From Boeing, Carnival and Delta Air Lines to Exxon Mobil and Macy's, many of the nation's most iconic companies aren't earning enough to cover their interest expenses (a key criterion, as most market experts define it, for zombie status). More than 200 corporations have joined the ranks of so-called zombie firms since the onset of the pandemic, according to a Bloomberg analysis of financial data from 3,000 of the country's largest publicly-traded companies. In fact, zombies now account for nearly a quarter of those firms. Even more stark, they've added almost US$1 trillion (S$1.33 trillion) of debt to their balance sheets in the span, bringing total obligations to US$1.98 trillion (S$2.63 trillion). That's more than the roughly US$1.58 trillion zombie companies owed at the peak of the financial crisis. The consequences for America's economic recovery are profound. The Federal Reserve's effort to stave off a rash of bankruptcies by purchasing corporate bonds might ver...