Is this an accurate summary of the situation with JPY? 1/ Japan runs up massive public debt in the 1990s–2000s after asset bubble collapses 2/ Central bank keeps rates near zero for decades to fight deflation and keep the debt serviceable 3/ The world borrows in JPY almost for free and leverages up (aka the yen carry trade) 4/ That cheap leverage flows into higher-yielding assets, including US equities and bonds 5/ Today the Bank of Japan is raising rates to normalize policy amid inflation and a weak yen 6/ Higher Japanese rates + stronger yen force carry trades to unwind 7/ This creates selling pressure that puts US equities at risk 8/ Japan intervenes to support the yen 9/ That’s not enough so now the US Treasury joins in by buying yen ??

Aug 1, 2026 · 12:16 PM UTC

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Replying to @ASvanevik
Yes. @Tom__Capital has been covering this extensively
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Replying to @ASvanevik
issa good ponzi
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Replying to @ASvanevik
gotta keep that ponzi flywheel going strong man otherwise there's no more waifu for the rest of us

ALT Chiakinanami Dangarompa GIF
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Replying to @ASvanevik
Fairly accurate. Do follow this account for more chilling take on how this can play out. @yutokanzakireal
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Replying to @ASvanevik
日元套息交易这轮平仓确实猛，但文章没提日本海外净资产那几万亿，真危机时回流反而撑住汇率
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Replying to @ASvanevik
the us treasury buying yen is wild feels like we’re in uncharted territory when they have to step in like that
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Replying to @ASvanevik
it's like trying to DCA into a dying memecoin
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Replying to @ASvanevik
Pretty much, until the last bit, because Uncle Sam buying yen sounds like the sort of thing people say right before getting margin called.
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Replying to @ASvanevik
meanwhile canadian inflation chilling im just watching all this from the sidelines
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Replying to @ASvanevik
Missing: - JMoF is tp’ing USGBs bought at ~100 yen/usd - Uses proceeds to retire JGBs >=10y instead of rolling over at high market rates - New debt needed is issued at better rates (2y, 5y) > you are here - BoJ normalizes rates, everything is fine, panicians lose again
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Replying to @ASvanevik
Smart money stacks during fear before the crowd starts chasing green candles
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Replying to @ASvanevik
I’m not gonna read all that ser is it bullish for Ethereum or not?
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Replying to @ASvanevik
Literally yes
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Replying to @ASvanevik
you're missing steps. after 7, the yen didn't strengthen as much as they wanted so therefore 8. 9: US sacrifices EUR to buy yen to avoid japan having to sell US bonds. These are important points you're missing.
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Replying to @ASvanevik
I have a question. if i can borrow at 1% in yen to earn >3% in usd, and yen keeps falling, doesn't that make carry trade very attractive. Why would there be major unwind in the carry trade ?
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Replying to @ASvanevik
If carry trade was unwinding yen would strengthen on its own. There would be no need for intervention
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Replying to @ASvanevik
Summary of CNA talking about the Yen
H@LZWH
Jul 28
youtu.be/QaRn4C0i4ec?is=lN85… Read CNA’s video in 1min
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Replying to @ASvanevik
That's pretty much it
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Replying to @ASvanevik
Decent for short term mechanics. PTJ delved into other issues on OShaughnessy’s podcast.
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Replying to @ASvanevik
so the fed's basically mopping up the mess from japan's debt hangover wild how decades of free money unwind in one ugly chain reaction
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Replying to @ASvanevik
I think it's not so much the foreign carry trade as Japanese Corporates who, because of their trade surplus, have ended up with enormous amounts of claims on the US. Up until now they've not repatriated the money, keeping it in USTs. If that changes 🇺🇸 goes bust
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Replying to @ASvanevik
The yen carry trade wasn’t a mystery; it was known and documented for decades. Central banks worldwide kept rates near zero partly because it eased their own debt burdens, and the 2% inflation target is convention, not hard science. Japanese citizens pay the bill via inflation.
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Replying to @ASvanevik
You have to start way earlier. Somewhere around 1. Instituting a central bank, thereby taking the democratic economic right to vote for the interest rate (among competing currencies) away from the people and 2. Creating a Ponzi scheme pension system
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Replying to @ASvanevik
What I truly, truly, truly do not understand is why people think that a forced seller is a bad thing for the asset owners? If the prices today are good, and JPY borrowers are forced to sell, won't that just be a temporary price dip that will benefit the buyers?
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Replying to @ASvanevik
（ΦωΦ）
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Replying to @ASvanevik
this is a solid breakdown, how long did it take you?
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Replying to @ASvanevik
i still think people are underestimating just how interconnected the yen carry trade is with global liquidity
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Replying to @ASvanevik
This stuff seems like woman’s period - come out to bother once a month and then quickly gone
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Replying to @ASvanevik
Yes that’s right Trillions of dollars in leverage
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Replying to @ASvanevik
supporting yen strengthens it even further, so your point is that the treasury is trying to make the situation even worse?
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Replying to @ASvanevik
Close. Between 1 and 2 you’re missing QQE, quantitative and qualitative easing. Also, the trouble in protecting the yen by raising interest rates is that it puts the Japanese government further in debt, since they pay debt by refinancing it. Potential domestic financial crisis.
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Replying to @ASvanevik
The missing piece is that the U.S. has little incentive to facilitate a large carry trade unwind. The Fed’s mandate is the U.S. economy, not the yen. That leaves the BoJ in an increasingly difficult position.
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Replying to @ASvanevik
U should see the Holy Shit potential LT 🎯 for the Yen 💴…let’s just call it 🧻
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Replying to @ASvanevik
yes, roughly. I think you're missing some potential blowbacks here if equities are sold too quickly, markets may halt while yen continues to strengthen. The asset value of borrowers will continue to decrease, some won't be able to sell and get caught in a stuck situation while their loans technically get more expensive to pay back, if their asset values drop too much, and the yen appreciates too much, they'll end up in default type of situation. It's a race to repatriate and unwind.
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Replying to @ASvanevik
No the carry trade being a problem is a meme because there still is a rate diff between both countries. The real problem is how they operated treasuries for ages. Central bank owns more than 60% of their bond and every problem stems from there
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Replying to @ASvanevik
This is hugely bullish across risk assets and metals.
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