Dividends lag equities, distressed debt continues to build

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Dividends lag equities, distressed debt continues to build

By Blu Putnam, Chief Economist & Erik Norland, Senior Economist, CME Group

Dividends Stagnate Even as Equities Shine

  • S&P 500 dividends grew 40% in 2000s, 155% in 2010s.
  • Expectations for dividends in 2020s have slipped from up 20% to down 10%.
  • Expectations are downcast despite equities recouping pandemic losses.
  • Did quantitative easing cause equities to decouple from dividends?
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Distressed Debt: A Growing Risk?

  • Government relief programs allow consumers to skip repayments.
  • The forbearance helps to conserve desperately needed cash.
  • Economy could rebound in Q3, but jobs comeback has slowed.
  • Could build up in distressed debt pose challenge to economy?
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