Alarm over corporate debt and stalled earnings

A further issue is the uses to which the debt has been put. As pointed out many times in the post-crisis years, it has generally not gone into capital expenditures, which might arguably be expected to boost the economy. It has instead been deployed to pay dividends, or to buy back stock -- or to buy other companies. Shifts in these uses of cash are now affecting markets.

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Such popularity for companies that pay out dividends is generally sign of bearishness and lack of trust. If investors want to be shown the money in this way, it suggests very low confidence in companies' ability to use the cash wisely. At this point, according to Mr Santschi, investors are eschewing buyback stocks because they fear that the buybacks will only be funded with further debt.

Companies can of course afford to stay highly levered without too much difficulty, while they enjoy fixed low rates. The problem, and the reason that investors have now started to focus on the problem, is producing the earnings and cash flows needed to pay their debt. That is why earnings are being watched with such anxiety.