The EBITDA Illusion: Why EBITDA Fails as a Debt Capacity Metric Series Context Article 1 — The Liquidity Cycle established the operating cycle as the governing structure behind capital. Cash does not move in a straight line from revenue to availability. It enters the business, is absorbed by working capital, and returns only when the...
The Liquidity Cycle: Why Credit Deterioration Is a Cash Timing Failure, Not a Lending Failure Introduction Credit deterioration is typically observed at the point of covenant breach, restructuring, or default. But those events are not the origin of failure—they are its surface expression. The structural problem begins earlier, in how debt is sized, underwritten, and...
