Leveraged Loans and Systemic Risk (Second of a Series)

According to a Harvard study, middle-aged men who did 40 pushups have a 96% lower risk of cardiovascular disease than those who did 10 or fewer.

Not since eighth grade gym class has anyone ordered us to “drop and give me twenty.” But surely in all those formative years we comfortably amassed 40 pushups. To our chagrin, however, a closer reading revealed they meant 40 pushups now in a row.

But are pushups themselves fending off heart attacks, or is the ability to do pushups just one indicator of a healthy, fit human being?

Cause and effect was also top of mind as we assessed media reports of risky leveraged loans threatening both the economy and the US financial system. The latest was a Bloomberg opinion piece that questionably indicted the entire collateralized loan obligation class (“The Bomb That Blew Up in 2008? We’re Planting Another One.”)