Who is blowing up in Japan?
Discussion
😮💨
I don’t know what this means but I’ll be interested to hear your take on
What makes you think that
Would love if you explained the Japan dynamic you mean here.
They sell treasuries to support yen? Carry trade stuff?
Yes, exactly.
Not only does the bank Japan have around 1.2 trillion in treasuries, but basically every single actor in the car trade uses the US government bond market as the collateral for the trade .
This means that when they get liquidated, they have to dump the bonds which causes the yield to spike
Word
Jesus apple speech to text is horrible 😞
Hi peruvian bull 🤟😉🏴☠️ Exactly. The JGB carry trade is deeply intertwined with the US Treasury market. When unwinds happen, forced selling of bonds triggers a chain reaction higher yields, tighter liquidity, and potential instability. The question is: how much pressure can the system take before something breaks?
The whole country?