Donald Trump could give the global credit cycle a spin. The new U.S. president may boost spending and growth. But rising interest rates will push up funding costs. Though credit markets have largely shrugged off Trump's victory, bloated balance sheets are ill-prepared for an end to loose policy.
The former reality-TV star wants to cut corporate taxes and invest in infrastructure, potentially boosting employment and earnings. That could help to extend the current era of limited corporate distress. Though defaults rose last year as low oil prices hit the energy sector, the failure rate has mostly been below the average of about 4 percent of junk-rated companies since 2009.