JAPAN AND US SET TO COLLAPSE TOGETHER SEAN FOO ON HOW JAPAN S RISING INTEREST RATES COULD FORCE IT TO SELL US TREASURIES, LEAD TO THE MELTDOWN OF US DOLLAR AND ASSETS

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Fatal: Japan’s Total BOND MELTDOWN Just Signaled US Assets Major Collapse Ahead

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Japan has been the source of extremely cheap, almost interest free loans, which US investors have used to buy US treasuries and other assets in so called Yen Carry Trades.

But Japan has now been forced to start raising interest rates to control inflation, and this rise in interest rates could have a knock on effect of devastating US investors.

US investors will  now also have to repay the virtually interest free loans at much higher interest rates of 2. 25 for the 10 yr bond and many investors  may have to start liquidating US bonds and assets and crypto to make the payments.

This as the interest rates on US bonds are coming down, meaning the profit for investors from selling US bonds to pay for loans in Japanese bonds will be minimal.

No one knows how big the investments in the US funded by the Yen Carry Trade are but they could be trillions. The interest payments due could be 100s of billions.

In fact, the global financial system is at risk.

In addition, Japan s currency is strengthening. This is hammering its exports and contributing to the downward debt spiral.

A stronger yen is also making replaying loans in Japanese yen more expenseive for US investors.

Tariffs and a trade war with China have also hit Japan s economy.

To try to save its exports, Japan is planning to sell its 1.2 trillion stash of US Treasuries and buy yen. This will keep the yen weak and make its exports more competitive.

25% of all the government s revenue goes on paying interest on its debts and as the interest rate rises it could soon be 40, 50, 80%..

To sump up. When Japan sells US treasuries, it could send the interest rate of US debt sky high and collapse the US dollar and economy.

In addition, US investors who have funded their investments using the Yen carry trade may have to sell their assets and bonds to repay their loans at much higher rates than their borrowed them at.

This could trigger a stock market and cypto collapse