Japan’s Own Buyer of Last Resort… Sells

The story of the week last week was not Greenland or Davos drama, but Japan.

Japanese bonds fell to their lowest price in history. When prices fall, yields rise. Traders in New York and elsewhere globally are unwinding their “carry-trade” bets.

So, too, the Bank of Japan:

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Lower demand for Japanese bonds is pushing prices down and yields higher rapidly. (Source: Bloomberg)

The Bank of Japan’s holdings of its own government’s bonds are now near a 10-year low.

The yen carry trade has been a constant in global finance for 3 decades. Currently, the unwind is throwing the Japanese government into a crisis of historic proportions.

Americans take note. Not only are Japanese bonds undermining the AI rally on Wall Street. The crisis is a cautionary tale for the U.S. efforts to finance its own historic debt load.

~ Addison

P.S. Yesterday’s Grey Swan Live! with Joel Bowman — our “man on the scene” in Buenos Aires since before President Milei got elected – helped us rummage through collectivist politics… also a harbinger of things to come in the U.S. if New York’s Zohran Mamdani becomes the face of the Democratic Party in the midterms.

Joel also gave us a fresh primer on Investing At the End of the World as the Argentine market rapidly becomes deregulated and open for foreign investment in the country’s vast natural resources.

The replay will be up on the site for members soon.

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Later today — Friday, at 1 p.m. ET – Nick is back to help us cut your IRS tax bill in 2026.

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Our guest Nick Buhelos is going to walk us through simple steps on how you can:

Unlock 250+ deductions you currently can’t access.
Apply trading losses to other income (W2, 1099, even your spouse’s).
Shield your personal finances from trading risk.

Stay tuned for more details on how to join us on Friday at 1 p.m. ET.

If you have requests for new guests you’d like to see join us for Grey Swan Live!, or have any questions for our guests, send them here.

How did we get here? Find out in these riveting reads: Demise of the Dollar, Financial Reckoning Day, and Empire of Debt — all three books are now available in their third post-pandemic editions. You might enjoy one or all three.

The story of the week last week was not Greenland or Davos drama, but Japan.

Japanese bonds fell to their lowest price in history. When prices fall, yields rise. Traders in New York and elsewhere globally are unwinding their “carry-trade” bets.

So, too, the Bank of Japan:

Turn Your Images On

Lower demand for Japanese bonds is pushing prices down and yields higher rapidly. (Source: Bloomberg)

The Bank of Japan’s holdings of its own government’s bonds are now near a 10-year low.

The yen carry trade has been a constant in global finance for 3 decades. Currently, the unwind is throwing the Japanese government into a crisis of historic proportions.

Americans take note. Not only are Japanese bonds undermining the AI rally on Wall Street. The crisis is a cautionary tale for the U.S. efforts to finance its own historic debt load.

~ Addison

Joel also gave us a fresh primer on Investing At the End of the World as the Argentine market rapidly becomes deregulated and open for foreign investment in the country’s vast natural resources.

The replay will be up on the site for members soon.

Turn Your Images On

Later today — Friday, at 1 p.m. ET – Nick is back to help us cut your IRS tax bill in 2026.

Turn Your Images On

Our guest Nick Buhelos is going to walk us through simple steps on how you can:

Unlock 250+ deductions you currently can’t access.
Apply trading losses to other income (W2, 1099, even your spouse’s).
Shield your personal finances from trading risk.

Stay tuned for more details on how to join us on Friday at 1 p.m. ET.

If you have requests for new guests you’d like to see join us for Grey Swan Live!, or have any questions for our guests, send them here.

Funds net sold U.S. equities for a fourth straight week, at the fastest clip since the opening chapter of the Trump trade war on April 2, 2025.

Despite that positioning, the indexes pushed higher on Monday.

Dip buyers stepped in after last week’s slide and nudged indexes back toward their highs.
Chipmakers gained ground, and a software ETF tacked on close to 7% across two sessions, a quick counterpoint to the sector’s recent purge. Sameer Samana at Wells Fargo Investment Institute described the move as the market’s reflex after steep selloffs—fast hands cover, slower money watches.

Every ten minutes, the bitcoin network completes another block of transaction data. Another bitcoin miner seeks a reward.

The reward is cut in half every four years, thanks to the “halving protocol” which established the coin’s scarcity algorithm. Next month, total bitcoin supply will hit 20 million, leaving just 1 million left to be mined.

The Nasdaq logged its fourth straight down week, pulled lower by the “SaaSpocalypse” in software.

Goldman Sachs’ Software Basket fell 16% for the week. Hedge fund exposure to software shrank sharply, according to Prime Book data.

Lou Miller, Goldman’s global head of Equity Custom Baskets, told clients that buyers remained scarce even as the group entered oversold territory.

In the late 1990s, telecom infrastructure outpaced demand, pricing compressed, and equity valuations adjusted long before usage caught up.

Today’s AI buildout carries healthier balance sheets and real utility, yet capital intensity remains high, and patience wears thin when returns depend on perfect adoption curves.

The week’s trading revealed that a rotation out of high-flying tech into defensive names is well underway. The Dow, which includes broader, non-tech-related stocks, is starting the week above 50,000 for the first time in its history.