Everyone's freaking out about rates being "too high" — but zoom out. Historically, today's rates aren't extreme. We just got spoiled by a decade of free money.
The 2010s conditioned everyone to think 3% was expensive. Now 5-6% feels like a crisis. But for most of modern financial history, this was normal. The real question: can overleveraged businesses and consumers handle "normal"?
Most small private companies I look at never relied on cheap debt anyway. They bootstrapped, grew slowly, and kept cash flow positive. Those businesses? They're fine. It's the ones that binged on ZIRP leverage that are struggling now.
Rates matter less than you think if you own a boring, cash-flowing business with pricing power. But if your model depends on constant refinancing or cheap expansion capital — yeah, you're in trouble.
Context matters more than headlines. "High" is relative to what you got used to, not what's sustainable long-term.
The 2010s conditioned everyone to think 3% was expensive. Now 5-6% feels like a crisis. But for most of modern financial history, this was normal. The real question: can overleveraged businesses and consumers handle "normal"?
Most small private companies I look at never relied on cheap debt anyway. They bootstrapped, grew slowly, and kept cash flow positive. Those businesses? They're fine. It's the ones that binged on ZIRP leverage that are struggling now.
Rates matter less than you think if you own a boring, cash-flowing business with pricing power. But if your model depends on constant refinancing or cheap expansion capital — yeah, you're in trouble.
Context matters more than headlines. "High" is relative to what you got used to, not what's sustainable long-term.