As those spreads have narrowed, issuance has revived: S&P puts global corporate bond issuance in the first half of the year at a record $1.79 trillion. But 80% of that was done by investment-grade companies and about 30% involved some sort of government guarantee. Of the $595 billion of corporate bonds issued in the United States, just $53 billion, or 9%, was sold by non-investment grade companies.

“Investment-grade issuers have been able to access the market pretty readily over the last several months,” says Mark Oline, head of the corporate finance group at Fitch Ratings. “If you migrate down the credit curve, the high-yield market is more open than it has been, but it has primarily focused on the stronger, double-B names. But we have seen issuance spread to single-B issuers as well.”

Non-investment-grade companies are also still largely closed out of the loan market, Oline says. “We are seeing some extensions, where companies are able to work with their bank group and in exchange for higher financing, they're able to extend their maturities.” But banks can no longer unload such loans to the purveyors of collateralized loan obligations (CLOs), which used to soak up as much as 70% of the non-investment-grade loans that banks originated, Oline says, “so that has resulted in a dramatic reduction in lending capacity.”

The constrained loan market also reflects tighter bank lending standards. The latest Fed survey of bank loan officers, in April, showed some moderation on that front, though; just 40% of banks had tightened their lending standards for commercial and industrial loans over the previous three months, down from the 65% that said they had done so in the January survey.

Even as corporate bond spreads tighten and banks become less stringent, Main Street's perception of the availability of credit will lag, says Cary Leahey, a senior managing director at Decision Economics. “Main Street is dominated by smaller businesses and they have virtually no ties to the capital markets, where we've seen the bulk of the improvement. The small guys are just getting killed.”

At the short end, the commercial paper market, also the province of larger companies, continues to contract, with the amount outstanding totaling just $1.066 trillion as of July 29. That's less than half the $2.2 trillion outstanding in August 2007, on the eve of the credit crisis. Kalish notes that commercial paper has suffered a “double whammy,” as the recession dampens corporations' need to borrow and the financial crisis leaves investors wary of buying any but the safest of securities.

Leahey notes, though, that while the amount of paper outstanding continues to decline, the share of that paper issued with government backing is also shrinking. As of July 23, the Federal Reserve's Commercial Paper Funding Facility had outstanding issuance of just $110.5 billion, down from $349.9 billion at the program's peak in January.