Who are the “living dead” companies?
Dec 24, 07:12

The zombie companies. These are real. When companies are making just enough to cover their operational expenses and service their debt, and have nothing left to invest in their growth, they become the “living dead” or zombie companies. The term seems to have originated to describe companies in Japan in the late nineties and early noughties, when the country's banks tried to keep the economy going after the collapse of an asset bubble. The banks kept lending to these weak companies, afraid to let them go bankrupt. Zombie companies are vulnerable to competitive and monetary headwinds, and bring down the productivity of the economy as a whole.

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