Japan’s COLLAPSING Economy Is About To Take Down EVERYTHING

Japan’s COLLAPSING Economy Is About To Take Down EVERYTHING

japan is about to take down the global economy their economy has been struggling for decades and is basically a zombie at this point their central bank has been manipulating the currency interest rates and their entire industry for decades but it’s finally started to break the reason for this disaster well Japan’s zombie economy has infected the rest of the world too the yen carry trade one of the oldest and most reliable trades in financial markets is unwinding and it’s failing and the yen carry trade has actually propped up our economies for decades as well which means we are going to feel the effects their currency is booming and not in a good way and this will lead to a global asset dump and a crash in stock prices as bond auctions fail investors panic and markets spiral in this video I’m going to explain exactly what’s going on and what you should be watching out for but I’m also going to show you how to protect yourself from this by jumping on top of a brand new $200 billion per year opportunity i even made a free guide here showing you how the industry works and how you can seize this opportunity to protect yourself there’s a free download link in the description down below so what’s actually going on with Japan well as I said their economy is basically a zombie at this point and it all starts with their aging population people just don’t have many kids in Japan anymore so their population is getting older that average age is going up and it’s worse in Japan than literally any other country in the entire world one in 10 people in Japan are now over the age of 80 and almost a third are over the age of 65 where in most countries you’d expect them to be retired by 2040 35% of their population will be at retirement age and that means that everyone else has to work twice as hard to generate wealth because 35% of the country will be too old to work and will have to rely on the state investments or their family to survive now their public spending is already skyhigh but it’s going to skyrocket due to these very specific demographic problems and going handinhand with that demographic crisis is their failing economy they were booming after the Second World War expected to overtake the US as the richest country in the world but then they had the worst economic crash in history and they still haven’t recovered more than 40 years later their GDP just doesn’t go up anymore their stocks don’t go up and the country is stuck in economic purgatory conventional economic theory says they should be cutting interest rates to stimulate economic growth cheap interest rates cheap debt more investment more spending and a growing economy but Japan’s been doing that for decades already they’ve had interest rates at zero or even negative since the 1990s and it’s barely had any effect no inflation and no economic growth but because interest rates are already close to zero they can’t really take their monetary policy any further and drop them more so what’s the next magical machine that governments think will fix everything well government spending and just spending for the sake of spending if you can’t get individuals and businesses to grow and improve the economy well you get the government to spend and do it instead the problem with that is that governments even the Japanese government are inherently inefficient so Japan has built up a deficit the likes of which the rest of the world would be absolutely terrified of the US often gets flack for spending too much and in fairness it does but their debt to GDP ratio sits at around 125% the UK another overspending government with no real economic growth for the last two decades our debt to GDP sits at about 95% but Japan their government debt to GDP sits at 215% and when you include all forms of debt it’s an eye watering 263% the result of this is Japan being the biggest creditor nation throughout human history they’ve been printing so much money for so long with nowhere to invest it within Japan that they’re just financing the rest of the world individual investors banks insurance companies pension funds and the Bank of Japan itself have been buying up huge amounts of foreign bonds and equities helping to finance the huge deficits in the rest of the world the amount of money we’re talking about here has changed everything the global economy for decades there’s so much cheap easy money in Japan and no growth within Japan itself so it all floods overseas that’s pushed interest rates down around the rest of the world because if there’s loads of Japanese buyers there’s more demand for debt and so the value of that debt rises and its interest rates fall in relative terms asset prices have been boosted too if you’re in Japan and you want to invest in real estate you’ll do it in America or some other stable economy if you’re a Japanese worker and you’ve saved up for some investments you’re going to buy shares in foreign companies all this increased demand for assets around the world has led to inflated asset prices being held up by Japan’s insanely loose monetary policy and if all that Japanese demand dries up we will see asset prices fall in America in Canada Europe Dubai Singapore literally everywhere but in particular Japanese investors love US treasuries they love American government bonds because they return 100 times better than Japanese ones and they’re seen as more stable than any other countries in the world now frankly to me that does sound like a disaster waiting to happen and it seems everyone else is finally starting to see it as well which is exactly why I’m so cautious when it comes to investing my time and that’s also why I built my second business Grow Coach where we help experts turn their knowledge into online coaching businesses now it recently occurred to me that there are literally thousands of educated informed and successful people and experts who watch this channel who might be looking to start a business or increase their income or build funds for retirement now we’ve worked with people in all different kinds of niches from real estate and investing to sales and career advancement all the way into hobbies and sports so if you do have expertise knowledge or experience in any field I made a free guide explaining how this business works and how you can turn your information that you already have into a six-figure online business the guide is 100% for free and you can download it by clicking the link down below in the description now if this situation with Japan has been a problem for years already why should we care now well because now everything is falling apart and the easiest way to see this is by taking a look at the yen carry trade now the yen carry trade is really really simple but it is incredibly profitable you borrow debt in yen because interest rates are so ridiculously low sometimes literally less than 0% and into the negatives then you convert the yen to another currency like US dollars then with those US dollars you’re able to invest into American assets like stocks or bonds or in particular US treasuries you make a profit based on the difference between the interest rate you’re paying and the return you get on those American assets so if you’re borrowing yen at say 0.1% and you invest into US treasuries at 5% you’re making close to a 5% gain on money that isn’t even yours it’s literally free profit and as long as the yen doesn’t increase in value when it’s time to pay off the debt you just convert the dollars back into yen you pay the loan off and everything is perfect but that’s the problem if the yen rises in value you can lose money with the yen carry trade and then people stop using it and that’s exactly what is happening right now last year the Bank of Japan rose interest rates by more than expected and they said they were going to continue raising rates as well they said the world of ultra low interest rates is over but what’s the result of that well the yen rose in value by as much as 14% in a single month and then suddenly the carry trade stopped working people were converting dollars to yen at higher prices wiping out all of their profits and actually making losses so investors rushed to unwind their trades sooner rather than later to keep the losses from being too high which led to greater demand for the yen and further rises in its value making the problem even worse many of those carry trades were highly leveraged so margin calls came in and people had no choice but to close out at a loss making the situation worse still the Japanese stock market saw its biggest daily fall since 1987 a drop of 15.6% in just a couple of days global stocks fell by 5.75% in just the first 5 days of August as all that Japanese money left the system and the yen then rose by 12% against the dollar making the situation for those carrying the trade even worse countries like India saw mass outflows of capital as all that Japanese money was taken back home and their markets got considerably weaker and the mirage of the yen carry trade being a risk-free profit was completely destroyed that means that even if Japan can fix their current problems they will never get back to that same state they were in before with all the benefits that the yen carry trade was bringing them now this didn’t stop in 2024 though it continued into 2025 as well and the problem has been steadily getting worse japanese government bonds have moved near record highs increasing the cost of borrowing and further rising fears of more capital outflows around the world the yen has appreciated by a further 8% since that crash last year and the gap between US and Japanese bond yields has fallen from 450 basis points to 320 more recently a new problem has risen with Japanese bond auctions failing due to such low demand for Japanese debt there’s just not enough demand to buy up those new bonds and confidence in them is waning but we of course need to remember that Japan is the most indebted country in the world with huge deficits that have to be financed so a failed bond auction is a disaster and the country has no option but to raise more debt and the only real way to do that is to raise interest rates 40-year yields hit 3.675% an all-time high and 20-year yields have reached their highest level since 2000 the Bank of Japan has raised its short-term policy rate to 0.5% the highest in 17 years and further hikes are looking incredibly likely as well this means all of Japan’s debt is more expensive to hold and pay off so they have to spend more of their government budget on paying off that debt and they can’t raise taxes or grow the economy so the only way to pay off the old debt is by getting into even more new debt if yields in Japan continue to grow and get more attractive to domestic investors and if the risk of the yen carry trade from a rising yen continues to grow it’s incredibly likely that the Japanese investors in the Bank of Japan will sell off American assets and bring that money back into Japan that will cause a massive drop in demand for all asset prices around the world and most importantly for governmentissued debt in countries like the US the UK and Canada that will send borrowing costs in our countries up which means higher taxes or more government debt there’ll be less capital in our countries less spending less investment and worse GDP figures when only looking at US treasuries and literally nothing else Japan owes more than $1 trillion adding in other government debt and it’s more than $2 trillion add in assets as well and it’s more than $3 trillion that money if it’s withdrawn back to Japan would essentially disappear from the global financial system and cause 10 times that impact to asset prices now Japan actually holds the entire global economy hostage right now because of all this to the extent that some think Japan may actually use all these foreign assets as leverage in trade talks to try and improve their situation whether or not that actually happens yet is to be seen but Japan has to do something because the situation is steadily getting worse if Japan raises interest rates their budget becomes completely unsustainable the value of the yen rises and mass capital outflows occur all around the world if the carry trade continues to unwind that same mass capital outflows occur those same mass capital outflows will occur global borrowing costs will rise and we will basically see a global recession japan’s borrowing costs are already projected to grow by more than 50% over the next few years rising to 35 trillion yen by 2028 if rates only rise to a low 2% this problem is a ticking time bomb with no way out japan’s economy and demographics mean they can’t grow their way out of this debt their rising inflation means they need to raise rates but their huge debt burden and rising yen values mean that actually they can’t raise those rates we’re entering into a truly vicious circle where there’s just no easy solution here and unfortunately just because we’re on the other side of the world that doesn’t mean we won’t be affected we absolutely will that’s exactly why I’m so careful when it comes to investing myself and why I spend so much of my time growing my online coaching business and helping others do the same as I mentioned earlier I put together a 100% free guide showing you exactly why and how the online coaching industry has exploded to more than $200 billion a year and I’m going to be giving away my free step-by-step framework so you can take your knowledge your experience and your information and turn that into a six-figure online business there’s a free download link in the description down below if you want to learn

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DISCLAIMERS:
I am not a financial advisor and this is not a financial advice channel. All information is provided strictly for educational purposes. It does not take into account anybody’s specific circumstances or situation. If you are making investment or other financial management decisions and require advice, please consult a suitably qualified licensed professional.