Corporate executives have two key objectives: generating profits and allocating firm capital to maximize those profits. A key consideration is whether to finance those objectives through operating cash flow, debt issuance or equity issuance. Given that interest rates are at all time lows and the FOMC is poised to tighten monetary policy, investors should understand the impact of rising interest rates on corporate earnings and profit margins. Below, I look at trends in profit margins, the cost of debt over the last five decades, and the implications for earnings.