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Borrowing Binge

Frontier -- Trends

Borrowing Binge

The best time to borrow is before you really need the money. That old saw may be what's sparking the rush to expand credit lines in the past year by the nation's fastest-growing small companies (chart). True, companies' cash flows are strong right now, but chief executives are likely looking for a bigger cushion to meet expenses, in case of an economic slowdown. Plus, debt got much cheaper at yearend. The Federal Reserve cut interest rates three times starting in September, while banks narrowed their lending spreads to drum up business.Return to top

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