We hate to say we told you so, but…

Six years ago, when interest rates were 1% to 2%, we wrote a column in the WSJ urging the Trump administration to issue more 30 and even 50 year treasury bonds to reduce future interest rates on what was then a $25 trillion national debt.

“Today’s historically low interest rates on government bonds, along with the flattening of the yield curve, offer Uncle Sam a once-in-a-lifetime opportunity to lower his interest expenses by trillions of dollars over the next three decades. The savings could be large enough to pay for the entire Trump tax cuts and make them permanent.”

Trump liked the idea but was talked out of it.

That was dumb, as we now know, given the higher refinancing rates today.

This chart from the OECD shows how foolish this decision was. The U.S. is more vulnerable to interest rate hikes than virtually any other major developed nation. Japan has a higher debt burden but they are locked into lower interest rates.

We hate to say we told you so… Even with rates higher today, we still think it makes sense to lock in current rates to hedge against higher rates. Remember, they went up to more than 11% under Jimmy Carter.