## figure1-5

## Source details

**Canonical URL:** [figure1-5](https://www.imf.org/-/media/files/publications/gfsr/2017/april/chapter-1/figure1-5.pdf)

## Other formats

- [Markdown version](/-/media/files/publications/gfsr/2017/april/chapter-1/figure1-5.pdf.md)
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### Key elements of policy stimulus proposals
- Corporate sector taxation
  - Potential reduction in corporate tax rate
  - Interest deductibility/expensing investment
  - Incentives for repatriation
- Other (infrastructure spending, deregulation, trade, and other policies)

### Financial stability risks in the corporate sector
- Excessive financial risk taking
- Corporate leverage peaking
- Credit cycle maturing
- Heightened vulnerability to default risk

### Stylized Corporate Balance Sheet
- Uses of Funds
  - Economic risk taking = Capital spending (including R&D)
  - Financial risk taking = Acquisition of financial assets, M&A, and share buybacks/dividends
- Sources of Funds
  - Internal funds (income, operating cash, and buffers)
  - Equity markets (cost of equity finance and issuance)
  - Debt markets (cost of borrowing and leverage limits)
  - Banks (cost and availability of loans)

*Sources: S&P 500; and IMF staff.*

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_Source: https://www.imf.org/-/media/files/publications/gfsr/2017/april/chapter-1/figure1-5.pdf_