Japan Betrays Trump and Chooses China in Response to US Tariffs

Japan Betrays Trump and Chooses China in Response to US Tariffs

Japan, a long-standing and close US ally in Asia, has just taken a step that Washington has perceived almost as a challenge. The government of Shigarua is making it clear they no longer intend to subordinate their national interests to those of the United States. The top priority now is saving Japan’s own economy. That is why Japan has resumed oil imports from Russia despite American sanctions. And this is far from the only signal that Tokyo is moving out from under Washington’s pressure. Just last month, Japan raised alarm over its rapidly growing national debt. And how did the United States respond? With silence, no aid, no statements of support, even though Japan remains the largest holder of US Treasury securities. With a portfolio exceeding $1 trillion under pressure from Trump’s tariffs, officials in Tokyo are already discussing the possibility of offloading those bonds. For the first time in a decade, Japan is signaling that its own interests now take precedence over those of others. Meanwhile, the world is increasingly shifting away from the dollar toward the UN, especially BRICS countries and more than 20 states that have joined the block. And here, Brazil comes to the forefront. It is now seriously considering lending and borrowing in yuan instead of dollars. All of this is unfolding against the backdrop of America’s massive national debt now approaching $ 37 trillion and declining interest in US bonds. If bricks fully transitions to the yuan, it could quietly trigger an irreversible collapse of the entire dollar-based system that has powered American global influence for decades. The most troubling part, most people have no idea it’s already begun. So, let’s take a closer look. For more than 50 years, Japan was America’s most reliable partner in Asia. It supported Washington’s policies and took care not to jeopardize the relationship. But now, that era of obedience is ending. Tokyo has made a move not only opposed by the US, but one Washington even tried to prevent. Japan has resumed importing oil from Russia, a direct challenge to the sanctions regime imposed after the start of the war in Ukraine. This is not some accidental transaction or a gray workaround. It’s an official government sanctioned decision to put national interest ahead of foreign pressure. It marks the first Russian oil shipment to Japan since early 2023, and it’s fully transparent. The government directed a private refiner, Taio Oil, to purchase 600,000 barrels of Sacklein Blend crude oil from the Sackelin 2 project, which also supplies Japan with liqufied natural gas. Here’s the key point. At that facility, gas is the main product and oil is a byproduct. If Japan refuses the oil, gas deliveries are also at risk. That’s why the government didn’t just allow the purchase. It initiated it and it did so at a time when the entire Western world is avoiding Russian oil. But it’s more complicated than that. The deal is taking place under a temporary US waiver, a special exemption allowing Japan to purchase Sackelin 2 oil without violating sanctions. For now, Tokyo is merely buying time, but it’s also sending a clear message. Japan will not wait for approval from across the ocean when its economy is on the line. There’s another twist. The oil was delivered by the tanker Voyager, a vessel sanctioned by both the US and the EU. Normally, engaging with such ships carries high legal risk, but because the temporary waiver is still active, there will be no penalty this time. Additionally, the EU does not impose secondary sanctions on non-European countries. So the deal remains legally sound. Still, the optics are grim. One of America’s closest allies importing Russian oil on a sanctioned vessel. All of this highlights how acute Japan’s energy situation is. After the Fukushima disaster, nuclear energy fell out of favor. Now the main source is LNG, and that means Japan must secure both the gas and the oil linked to it. And when gas supplies are threatened, Japan is willing to compromise. But this may have consequences far beyond Japan. If Tokyo is allowed exemptions and can freely import Russian oil, then why shouldn’t other countries demand the same? Every such precedent weakens Western sanctions and provides Moscow with a financial lifeline at a time when the United States and its allies are trying to isolate Russia. This is no longer just an energy transaction. It’s a serious warning. Japan’s return to Russian oil shows just how easily the West’s apparent unity can unravel when economic interests clash with political goals. And this might only be the beginning. But it’s not just about oil. Japan is facing a sharp sovereign debt crisis. Last month, the government officially declared the situation extremely serious. Japan now holds the highest public debt ratio among developed nations, over 260% of its gross domestic product. The yen is weakening, inflation is rising, and the economy is under growing pressure. The prime minister has already stated that Japan’s fiscal situation is worse than Greece’s during its darkest times. And how did the United States respond? It didn’t. No financial aid, no statements of support, not even a hint of solidarity. Yet for decades, Japan was one of the main underwriters of the US economy. It holds over $1 trillion in US Treasury securities, more than any other country. That money financed American wars, stimulus programs, and massive federal spending. And now, when Japan is in trouble, America remains silent. That silence is forcing Tokyo to reconsider its priorities. Why should Japan protect the dollar if the United States is unwilling to help Japan in return? Alarm bells are ringing in Tokyo. The government may begin selling off US bonds to support its own economy. If that happens, the consequences could be severe. Interest rates in the United States might spike. The dollar could weaken and other countries watching Japan’s example may also start dumping American debt on mass. New strategic directions are also emerging. Despite long-standing tensions, Japan is signaling a willingness to improve trade ties with China. Simultaneously, it is strengthening relations with other Asian nations. Tokyo is preparing for a future in which it may have to rely solely on itself. Meanwhile, BRICS countries are doing what was once only whispered about. It is now becoming reality. They are turning away from US Treasury bonds and starting to invest in bonds denominated in Chinese UAN. Brazil was the first to change course. It began issuing bonds not in dollars but in UAN. And this shift is not just about finance. It’s about safeguarding sovereignty. After the United States froze Russian assets and cut it off from global payment systems, many nations began to wonder if conflict arises, could their money be at risk, too? Brazil no longer looks to the west for help. It is turning toward China and receiving favorable terms in return. Fewer restrictions, flexible interest rates, and access to major financial infrastructure. This allows Brazil to avoid the risks associated with the US dollar. And Brazil is not alone. India, South Africa, Turkey, and Argentina are all watching closely. Some have already begun preparing for a shift. For countries in the global south, bonds denominated in yuan are increasingly seen as safer and more attractive than their American counterparts. China is ready for this. Its central bank has long been developing UN-based settlement systems, signing currency swap agreements, and making it easier for foreign investors to access its bond market. In the past, the United States dominated the global economy because everyone needed dollars. But now more and more countries are growing tired of being dependent on decisions made in Washington. When the US raises interest rates, it hurts other economies, imposes sanctions, and restricts access to dollars. That is why BRICS nations are turning to the UN to protect themselves and build greater independence. And it’s not just about buying bonds. Chinese banks are already helping BRICS countries not only issue debt, but also build full-scale financial operations, all in Yuan. Just a few days ago, Brazil made a major announcement. It plans to issue so-called panda bonds, bonds denominated in Chinese yuan. This may sound like another technical step, but in reality, it represents a potential shift in the global financial system. Brazil is a large economy and its actions matter. If it succeeds in raising capital in yuan, others will likely follow. This could be the beginning of a long, steady move away from the US dollar. If there is no demand for US government bonds, interest rates must rise to attract investors and higher rates mean it becomes more expensive for the government to borrow money. Today, US national debt is nearing $37 trillion. Even a modest increase in interest rates could add hundreds of billions of dollars in extra costs every year. The dollar will not collapse overnight, but step by step, it is losing the special status that once made it the foundation of the global economy. And the most alarming part, if the United States can no longer attract foreign capital, it simply won’t be able to finance its own debt. And what about Japan? Things are far from simple there, especially in the bond market. Yields on long-term Japanese bonds have started to surge. The yield on 40-year bonds recently broke a record, hitting 3.07%. It has since slightly decreased to 3.018%, but that is still 70 basis points higher than at the beginning of the year. Yields on 30 and 20-year bonds are rising as well by 60 and 50 basis points respectively. At first glance, these numbers may seem small, but in the world of bonds, this is a significant and dangerous shift. As a result, Japanese investors have begun moving capital back home on a massive scale. In 2024 alone, they purchased a record 28 trillion yen in Japanese bonds, about 180 billion US. Meanwhile, investments in American and other foreign bonds have been cut in half. This is what economists call a capital outflow. Money is fleeing the United States and returning to Japan. And it is all because Japanese bonds now offer far more attractive yields. All of this points to one clear trend. Trust in the US financial system is eroding. And this erosion is visible from Tokyo to S. Paulo, from the BRICS nations to the entire global south. Now the key question is what will Donald Trump do? Will he try to restore lost confidence or will he double down and continue his path of economic confrontation? To stay updated on how this unfolds, subscribe to the channel and turn on notifications. We may be witnessing the collapse of the old system and the birth of a new global reality. Thanks for watching and see you in the next video.

In a stunning geopolitical move, Japan has shifted its economic alignment away from the United States and toward China. This decision comes amid rising tensions caused by aggressive tariffs imposed by the Trump administration. Once considered a loyal ally of Washington, Tokyo now appears to be seeking stronger trade and diplomatic ties with Beijing.