In some contexts (the analysis of financial leases, for example) depreciation tax shields are treated as safe, nominal cash flows and are discounted at an aftertax borrowing or lending rate.
It values long-term securities at par even when the market has heavily discounted them and imposes hardly any penalty above the market rate of interest.
While Gallatin found ways to raise money by discounting treasury bonds, Madison kept looking for a competent general (a struggle known by most presidents thereafter).
If interest rates go up a lot, then they're in trouble because the cost of money's gonna be too high to more than offset with the merchant discount rate.