When the Federal Reserve says that they are going to hike rates by as much as 75 basis points, the one thing that should worry every investor is the level of debts gorged by companies since the Great Recession of 2008/09.

The net debt to earnings before interest, tax, depreciation and amortization (EBITDA) for non-financial corporations for High-Yield companies are currently above 4 percent, which is higher than the previous peak in 2001. The ratio for the lower investment grade corporate is currently just below 2.5 percent, which is above the 2008 peak and just shy of that of 2001. For higher investment grade corporates the ratio is just around the 2001 peak at 2 percent. Currently, the dollar denominated debt around the world stands at $52 trillion, which is almost three times the size of the US economy. A 75 basis points increase in the interest rate would lead to an additional burden of additional $390 billion on those debts, which is larger the GDP of Norway.