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My point is that it's not that hard to beat 4% a year. Heck, some stocks pay 2% in dividends and also appreciate.
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Your premise is sound and your strategy would have been extremely successful over the past few years. But many people who borrow at these rates today will end up investing in vastly inflated asset classes such as the real estate market or the US stock market and get burned badly. My personal belief is that at some point in the future, as has happened periodically through history, the average citizen will be begging for 4% returns.
Most of our generation doesn't have much fear because they have never really experienced a prolonged bear market before. You would have gotten completely owned investing in stocks during the 1970's, and bonds were considered the superior asset class based on returns from the previous few decades. Most of us probably weren't even alive during that. And this was nothing compared to the 1930's or Japan in the 90's.
They have been giving away money in Japan for a decade. How has that worked out for Japanese investors?
http://finance.yahoo.com/q/bc?s=%5EN225&t=my
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