The Bank of Japan just did what most thought was impossible: another rate hike, pushing JGB yields into territory the modern financial system has never had to absorb.

This isnā€™t a Japan-only story.
This is a global stress test.

šŸ§Ø WHY THIS IS DANGEROUS ā€” FAST

For decades, Japan survived on near-zero rates.
That was the life support.

Now itā€™s gone ā€” and the math turns brutal.

ā€¢ šŸ‡ÆšŸ‡µ ~$10 TRILLION in government debt
ā€¢ Higher yields = exploding debt service
ā€¢ Interest starts eating fiscal revenue
ā€¢ Policy flexibility disappears

No modern economy escapes this cleanly:
ā†’ Default
ā†’ Restructuring
ā†’ Inflation

And Japan never breaks alone.

šŸŒ THE HIDDEN GLOBAL SHOCKWAVE

Japan holds trillions in foreign assets:
ā€¢ $1T+ in U.S. Treasuries
ā€¢ Hundreds of billions in global stocks & bonds

Those positions only worked when Japanese yields paid nothing.

Now?
ā€¢ Domestic bonds finally pay real returns
ā€¢ After FX hedging, U.S. Treasuries lose money for Japanese investors

Thatā€™s not sentiment.
Thatā€™s arithmetic.

šŸ’„ Capital comes home.

Even a few hundred billion in repatriation = global liquidity vacuum.

šŸ’£ THE REAL DETONATOR: YEN CARRY TRADE

Over $1 TRILLION borrowed cheaply in yen and deployed into:
ā†’ Stocks
ā†’ Crypto
ā†’ EM assets

As Japanese rates rise and the yen strengthens:
ā€¢ Carry trades unwind
ā€¢ Margin calls trigger
ā€¢ Forced selling begins
ā€¢ Correlations go to ONE

Everything sells. Together.

āš ļø SECOND-ORDER EFFECTS

ā€¢ U.S.ā€“Japan yield spreads tighten
ā€¢ Japan has less incentive to fund U.S. deficits
ā€¢ U.S. borrowing costs rise

And if the BoJ hikes again?
ā†’ Yen spikes
ā†’ Carry trades detonate harder
ā†’ Risk assets feel it instantly

Printing isnā€™t an option anymore:
Print ā†’ Yen weakens ā†’ Import inflation explodes ā†’ Domestic pressure spikes

šŸ“‰ This isnā€™t noise.
This is macro gravity reasserting itself.

Watch the next 48 hours closely.

$ENSO $SCRT $SENT
#Macro #BankOfJapan #Yen #carrytrade #GlobalLiquiditpy #CryptoMacro