Midas
@DeFiMidas • 103,413 subscribers
𝔸𝕚𝕣𝕕𝕣𝕠𝕡 𝕒𝕟𝕕 𝔻𝕖𝔽𝕚 𝕥𝕙𝕣𝕖𝕒𝕕𝕠𝕠𝕠𝕣 🧵 𝕪𝕠𝕦𝕣 𝕘𝕦𝕚𝕕𝕖 𝕚𝕟 𝕨𝕠𝕣𝕝𝕕 𝕠𝕗 𝕎𝔼𝔹𝟛 𝕒𝕟𝕕 𝔻𝕖𝔽𝕚
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🚨THIS WEEK WILL BE THE WORST ONE IN 2026 Japan just begin biggest sell off EVER They are about to dump ~$6T of foreign securities, mostly U.S. Treasuries, stocks, and ETFs This will cause biggest crash, even bigger than it was on 10.10 flush crash While the rest of the world paid normal interest rates, Japan kept borrowing costs close to zero for decades Hedge funds, banks and institutions took full advantage of it They borrowed trillions of yen for almost nothing and deployed that capital wherever returns were higher - U.S. Treasuries - S&P 500 - Nasdaq stocks - Real estate - Emerging markets - Eventually, even crypto Wall Street called it the Yen Carry Trade It quietly became one of the biggest liquidity engines in modern financial history As long as Japan kept rates near zero, the machine kept running Cheap money kept flowing, risk assets kept benefiting, but that world is starting to change After decades of deflation, inflation has finally returned to Japan For the first time in years, the Bank of Japan is raising interest rates It sounds like a local story It's not Higher borrowing costs completely change the economics behind the carry trade The more expensive yen becomes, the less attractive the strategy is Instead of sending money overseas, investors start unwinding positions They repay yen loans and bring capital back home Markets call this a reverse carry trade And it destroys liquidity much faster than it creates it We already got a small preview in August 2024 Fears around the carry trade triggered a sharp sell-off across global markets and reminded everyone how dependent they had become on Japanese money Now imagine that process playing out over years instead of days Japan isn't just another investor It owns roughly $1.1 trillion in U.S. Treasuries It also holds around $6 trillion in net foreign assets, making it the largest overseas creditor in the world That doesn't mean Japan is about to dump $6 trillion tomorrow That's simply not how capital flows work The viral posts are massively oversimplifying the story But they are pointing at a real trend If even a small portion of that capital gradually comes home, global liquidity becomes much tighter than markets have been used to for decades And that's a much bigger deal than most investors realize - Stocks - Bonds - Private equity - Real estate - Crypto Almost every major bull market of the last 30 years was built during an era of abundant liquidity When liquidity expands, valuations become easier to justify When liquidity disappears, everything gets repriced That's why what happens in Japan over the next few years could become one of the biggest macro stories of this cycle Because the biggest risk isn't that Japan suddenly sells everything The biggest risk is that the world's largest source of cheap money quietly stops financing everyone else Remember that I am posting news daily and monitoring each major macro event to post and warn you So make sure to follow me and turn notifs on
Midas57,917 görüntüleme • 13 gün önce
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