Here is a different angle on interest rates. Let's note that the people running the biggest corporations in the world are also the stupidest people on the planet. That's a given. Or else we understand no one is that stupid therefore they know what they are doing. Every major corporation moved key business components to China, because to secure the livelihood of your company the smartest thing to do is put your business future directly in the hands of communist government and its decisions. Remember that whole war on communism where all these western ideology driven people decided a few hundred million commies had to be killed? Yes, the natural evolution of that was to put your capitalist enterprise directly in the hands of commies.
I digress somewhat but there is a point here, because I am talking of the apparent stupidity of the world's best business managers, (and the same applies to the world wide central banking cartel). These same people, after setting up total dependence on commies, then have gone on to saddle themselves with massive debt. Because debt is cheap, so keep adding more. What could go wrong. Let's even buy back shares - with debt. Because nothing can go wrong. Debt is expanding because it is cheap to borrow.
While the peasants are believing that "inflation" is caused by not being able to get their new boat in 4 months of ordering, they are also likely to beleive these massive corporations are also totally unprepared for not being able to kick the can of debt servicing down the road like for the last 15 years. Who could ever expect that cheap debt and share buy backs could never go one indefinitely?
But just suppose that all the big corporations are suddenly blind sided by the flying pig event of interest rates going up. What happens to all that corporate debt? Let me guess, it too will be totally unexpected and the peasants will beleive what ever the tv says. Probably something to do with lack of revenue because of supply chain issues, probably originating with putting everything in China.
I will copy a couple other posters comments just because I am getting too lazy to further point out how the world really works.
In my simple way of thinking, one impression I've had in recent years is that the stock market is so manipulated that it won't crash unless those in control want it to crash. Naturally this is based on my not understanding the inner workings of the market.
If 2 1/2 years of covid have taught us anything it is that rule of law no longer exists in the West. Those in authority ignore basic rules and make up whatever rules they like. Is it possible for them to suspend "supply and demand" permanently by simply rigging everything? I'm pretty sure reality has the final say.
Are rising rates all that it will take to inject reality, as in a 50% value drop?
Could the Fed, by cutting rates at the first sign of crisis, manipulate the market so there isn't a big crash?
And there is this one, because when corporations "suddenly" realize that cheap interest rates may come to an end and debt now becomes a liability, what happens? I actually don't know, because as said before, it's a rigged system. I know what would happen if we had a free market capitalist system.
Let me see if I can get this right. Corporations do not pay off debt because they want to use financial leverage to increase earnings. So, debt is not retired.
In a falling-interest-rate environment that means say XXX amount of debt is appropriate. But, in a rising-interest-rate environment that means say X amount of debt is appropriate. So, the company needs to retire XX to get to where it needs to be when the environments switch.
If the company is retiring XX, then it is not spending on something else. That something else is probably taken from a long list of cost-cutting measures such as capital expenditures, maintenance (lol), salary freezes (ouch),...
Honestly, I would not be surprised at a 50% drop from here to the bottom.
The basic question in all this is:
Are the central bankers, corporations and governments all that collectively stupid for all at once to get into a situation where the outcome is pretty easy to see if we actually do live in a free market, capitalist, democratic system. Or is it more accurate to say it is the peasants who are the stupid ones to beleive all this can occur simultaneously in a world that operates as they are told and so they need not question anything.