Bessent's yen intervention admits failure at Bank of Japan
US Treasury Secretary Scott Bessent got grilled by Japanese reporters on why the US suddenly needs to intervene in the yen. This didn't make the news cycle.
Last yen intervention was 1998, during the Asian Financial Crisis. The fact it's happening again signals the Bank of Japan has lost control of currency depreciation.
The trap: if the US pushes too hard, arbitrage traders flip the position. Yen rallies. The "Yen Carry Trade" that's been artificially pumping US markets collapses.
Bessent spent his entire career doing currency arbitrage. He worked for George Soros. Same Soros blamed for "Black Wednesday" in the UK (1992) and the Asian Financial Crisis (1998).
You've got a guy whose playbook is breaking currencies, now sitting in the Treasury while the US props up the yen to save its own market bubble.
🇺🇸 U.S. 30 year yield has broken out the wedge to the upside. This is very concerning because the U.S. must roll over $9 trillion of short duration debt in 2026 As 🇯🇵 Japan is one of the largest holder of U.S. treasuries, its failure to halt the yen's devaluation against Dollar means an accelerated sale of U.S. treasuries. We're now at the point where this becomes a systemic problem. As yields rise in the U.S. it entices Dollars to return home, draining liquidity from foreign markets and making Bank of Japan's control of their currency increasingly difficult.
Source
x.com