When analysing the effect of COVID-19 on business balance sheets, most attention is given to the surge in debt. But this ignores the fact that non-financial firms in DMs have built up a pile of excess cash worth $1.6tn (4% of GDP), so their balance sheets are not as precarious as they first seem. Corporates may yet surprise us by running down savings to boost investment by even more than we expect in the years ahead.
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