In a Review and Outlook column in the Opinion section of the Wall Street Journal, an unnamed author posits the idea of the US Treasury taking advantage of the low interest rate environment created by the US Federal Reserve and other Central Banks around the globe by refinancing its relatively short-term average maturity on its $14 Trillion in debt.

Albeit, this idea first raised our eyebrows as the thought of “extending and pretending” the debt is somehow a long-term strategy for success, seemed ludicrous. However, the author has a point. Just like a smart mortgage consumer, who refinances their home mortgage when rates fall, why couldn’t the Treasury do the same with the nation’s debt? How will that affect investments? As we all know, the debt will not go away overnight, however, what is in the Treasury’s control is locking in rates, to stem the tide of ballooning interest payments (the cost of carry) when rates go up.