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The bad debt rate is just 0.19%.
Mr. Greenspan's favorite indicator of interest rates is not the yield on government securities, but the Standard & Poor's BBB corporate debt rate, adjusted for inflation expectations.
In recent years, as the economy has changed in character, Mr. Greenspan, the chairman of the Federal Reserve, has been known to review reams of data, from corrugated-box sales to a little-watched corporate debt rate.
"Anything you can do to chisel the debt rate down as much as you can will be to your benefit," he says.
This assumes constant volatility, dividends and a risk-free debt rate over the ten-year-or-so term of employee options.
This is a lower level of default than the 10% bad debt rate on credit card lending, which has led banks to write off billions of pounds in the past few years.
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On May 20th Fitch, a ratings agency, cut the country's debt rating by another three notches.
More Competition, Better Ratings? 11.04.02 There's no question corporate debt rating could be vastly improved.
The stock offering is imperative for Lucent's debt rating.
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