No surprise here: As the recession grinds on, more companies are falling behind on their debt payments. The default rate tops 11%, up from 2.4% last year-and could peak at 12.8% by the end of the year, the highest ever, according to credit rating agency Moody's Investors Service. But what's worrying economists more is that the rate could remain stubbornly high for quite a while. "Be prepared for arnmulti-year period of high defaults," says Louise Purtle, a senior analyst at Credit -Sights. "We're going to see peaks like a mountain range."rnThat's a departure from the usual pattern in recessions, even severe ones. Historically corporate defaults spike as downturns ease, then fall back to more normal levels. But the recovery may be delayed this time around. Companiesrnaren't cleaning up their balance sheets that much, and current debt levels are unsustainable. The debt overhang could hamper the economy for years to come.
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