Japanese Yen Crisis is bulllish for silver and gold

by

in

Japanese Yen collapsing and they are dumping US treasuries to attempt to prop up their currency. Fed will chicken out of raising rates to save the Japanese yen because the Japanese are the USA’s biggest bond holders. Credit swaps, more repo nonsense, and possibly even QE or lowering rates to make US treasuries great again will be the only tool they have in their shed to stop the bleeding. When it comes down to a economic crisis or more inflation, Fed will pick inflation every time. Tue empty threats from the fed dissenters is to posture like hawks but they know they can’t raise rates, which would make the debt borrowing too expensive and treasuries unattractive for the Japanese

Essentially, as Japan liquidates US Treasuries to prop up its currency, the Japanese yen will face structural debasement under the weight of massive domestic debt obligations. In response, the US Federal Reserve will be forced to cut rates and expand its balance sheet to absorb the dumped Treasuries and prevent an domestic credit freeze

submitted by /u/BrigadierPirate
[link] [comments]


Comments

Leave a Reply

Your email address will not be published. Required fields are marked *