Over 40% of small cap companies in the Russell 2000 index are experiencing negative net income, a trend that has been growing over the past two years, possibly influenced by increased funding rates. However, what is concerning is that this trend actually began in 2007, indicating a potentially significant issue. The fact that the number of unprofitable companies has increased despite the Federal Reserve’s low interest rates is particularly worrisome. If these trends continue, it is likely that a slight economic downturn would result in more than half of these companies becoming unprofitable, making it a concerning situation overall, akin to a super-index.