The Business Roundtable is a Washington-based association of leaders of America’s largest businesses. They publish a quarterly survey of their members’ CEOs, summarizing expectations for sales, capital expenditures, and hiring over the next six months. I had the privilege of attending a conference call about this month’s survey, hosted by BRT chairman Ivan Seidenberg, who is the chairman and CEO of Verizon.

The top line is that America’s large-business leaders see continued economic weakness ahead, but not quite as bad as they did three months ago. Still, the picture is gruesome. BRT boils their survey results into an index which is still deep in territory that predicts continued economic contraction ahead.

Given my focus on capital markets, I asked Mr. Seidenberg what he’s seeing in terms of corporate finance. For the past several months, corporate debt has been on fire, as investors have snapped up existing debt and new issues at a rapid pace. I wanted to get some sense for where that new financing is going. Obviously, if it’s being used for expansion and investments in new capacity, that’s a very positive indicator for the economy. My theory all along has rather been that CFOs are taking advantage of the (temporarily?) improved conditions for corporate finance to do some balance-sheet repair.

Seidenberg’s response indicated that there’s no real constraint of access to capital, at least for America’s largest corporations. Spreads are favorable and debt isn’t seen as too expensive. What’s not in place yet is any rationale for using capital to expand capacity, and that’s because demand for goods and services continues to be very weak. Corporations have the ability to expand, but the fish aren’t biting yet, so business will stand by for now.

Since it takes businesses a significant amount of time to respond to improved demand and start ramping up capital investment and hiring, the bottom line is a prolonged period of weak overall growth.

It’s very important to keep the perspective in mind here. Again, the Business Roundtable speaks for large businesses, who (except for financial businesses) generally entered this recession with very healthy balance sheets. (There’s an important clue to the character of this recession in that, because recessions typically are caused by overexpansion.) Big companies won’t have much trouble riding out the storm.

This is to say nothing at all about small companies, who have no access to the capital markets and generally rely on bank financing. And there’s no sign that bank financing is coming back. We now know that large companies are seeing comfortable financing conditions amid a weak outlook. The data on small business is much sketchier, and I wouldn’t be surprised if many of them are hurting big-time from a lack of access to capital.