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Fears of a global recession are scaring U.S. companies, pushing them to use excess capital to reduce debt and add to cash reserves, rather than levering up and making risky bets as they have in the past.
Why it matters: This newfound corporate responsibility, motivated largely by fear, could help insulate the economy from another damaging recession.
Driving the news: A "floodgate" of $25.5 billion of investment grade corporate debt unrolled yesterday, representing the highest number of issuers and the second highest amount of debt ever issued in a single day, according to Bank of America Merrill Lynch data.
Between the lines: The difference between Wednesday and previous high issue days is many companies are using the new issues to refinance existing debt rather than make new purchases or spend, BAML notes.
Details: The investment bank's data also shows S&P 500 companies, especially in tech, have slowed the pace of stock buybacks this year, with share repurchases in the third quarter down 12% year over year so far.
Don't forget: The Business Roundtable, an association of CEOs of the biggest companies in the U.S., recently issued a statement on “the purpose of a corporation,” arguing that companies should no longer advance only the interests of shareholders. Rather, they must also invest in their employees, protect the environment, and deal fairly and ethically with their suppliers.
The bottom line: The combination of lower debt, higher cash balances and less risky investments may not be exciting news for the stock market, but could well give the U.S. economy another leg to stand on in the face of rising global uncertainty and weakening growth.
Walmart announced Tuesday it will stop all sales of handgun and short-barrel rifle ammunition, while prohibiting customers who are not law enforcement officials from openly carrying guns in the store.
By the numbers: Research firm CivicScience's survey of 1,986 U.S. adult Walmart shoppers found that under the change to its open carry policy...
The intrigue: The data shows an improvement from the generally positive results of a similar survey of Dick's Sporting Goods customers conducted in March after that company announced it would no longer sell firearms.
The results: In August, Dick’s announced its strongest quarter since 2016 and raised its full year guidance, after unimpressive sales immediately following the announcement.
More companies are starting to turn away from plastics as calls grow for more sustainable accountability from the world's top corporations.
What's happening: Marriott International, the world’s largest hotel chain, said last week it would stop stocking small plastic bottles of shampoo, conditioner and bath gel in its hotel rooms around the world by December next year.
Details: "Around the world, almost 1 million plastic bottles are purchased every minute," report Reuters' Simon Scarr and Marco Hernandez as part of a visualization project titled "Drowning in plastic" that details the swelling volume of plastics globally.
Go deeper: Drowning in plastic — visualizing the world's addiction to plastic bottles (Reuters)
Europe’s top banking executives are joining politicians in a wide-ranging pushback against negative interest rates ahead of this month's ECB meeting.
Driving the news: Deutsche Bank CEO Christian Sewing on Wednesday warned that further reducing interest rates, as the central bank is widely expected to do next week, will "ruin the financial system" and have “grave side effects” for the region.
The big picture: Ermotti and Sewing’s comments add to growing concerns across Europe that the ECB’s monetary policy is threatening the business of banking altogether and inducing people to stuff money in their mattresses rather than holding it in bank accounts.
What to watch: The disquiet has even reached the ECB's expected next president, Christine Lagarde, who promised Wednesday to review the costs and benefits of negative interest rates and bond purchases, though most expect her to continue the policies.