When Margin Float decides which obligations to float, it ranks each candidate by a value-per-dollar, using the blended distributions yield (≈ 4.8% at Base — 30% anchor at 2% + 70% HY at 6%) against the margin rate (≈ 4.95%):
- Bill / low-rate minimum:
yield − marginRate≈ 4.8% − 4.95% ≈ breakeven on distributions alone. - High-rate debt principal (e.g. 22% card):
yield + (debtAPR − marginRate)≈ 4.8% + (22% − 4.95%) ≈ 21.9% / yr per $1.
High-APR debt principal dominates everything else by a mile — that's why capacity goes there first, then falls through to bills.
Why floating a bill is still net-positive
The value-per-dollar is a conservative ranking signal (distributions vs borrow cost only). The projection itself compounds the freed cash at the full expected total return (≈ 7% at Base = yield + growth), which is above the margin rate — so floating a bill is still net-positive over time even when its distribution spread is ~0.
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