Japans Norinchukin Bank Reveals $65B Bond-Infested Poker Hand | Rafi Farber

Do not try it. Don’t turn… Ow! Hey guys, Raf here from The End Game Investor, and as I’m sure you’ve heard by now, Now, a Japanese bank called Nohrenchuk-Numchuk-Naverchik something. They’re selling like $65 billion worth of treasuries and other non-Japanese bonds. I would assume mostly treasuries and some European bonds, etc. They are in trouble because they have unrealized losses and they have to sell these things so they can buy other things that they think they can make more money on. Apparently, this isn’t a problem at all and everything’s fine as it always is with collapsing banks.

There’s never any problems. There’s never any trouble and you can’t admit anything. My question is, when you’re playing poker, do you show your hand? If you’ve got $65 billion worth of bonds to sell, do you announce it to the whole world that you’re going to do this because you want them to know what you’re about to do so they can front-run you? This does not make much sense. If you want to get really conspiratorial about it, you could say that maybe it’s the Bank of Japan that wants them to tell the world that they’re selling $65 billion of bonds because they want to force the Fed to lower interest rates so that the spread between the Japanese yen and the U.S.

dollar is something less than 500 basis points or whatever it is so that the yen can survive the next few months. I want to show you a chart. This is the Japanese yen. It’s not doing well. This is the Japanese yen since, whoa, 1971. We know that date. August 1971. Look at that. I know that date. That’s a very famous date in gold bug land. We are at the final support here. The higher it goes, the weaker the yen is the yen to the dollar. So we’re at 158.68 right now and this is about the support zone for March 1990, which is the last time that the Nikkei was at its all-time high.

Now I want to show you something else. If we look at a one-year chart of the yen, which is in red, and remember the higher the red line goes, the weaker the yen, and the Japanese 10-year bond, the higher it goes, the higher the yield. You can see that the yen weakening goes in tandem with Japanese bonds weakening. So the higher Japanese interest rates go, the lower the yen goes. And that’s not normal because usually you assume in Keynesian thinking that the higher interest rates go, the stronger your currency gets. But that’s not the case with the Japanese yen because the yen is basically all bonds because that’s all the Japanese bank, the Bank of Japan, Central Bank owns.

So when Japanese government bonds go down, when their yield goes up, the yen weakens. Basically the yen is screwed. The lower its interest rates go, then the higher the spread between dollar rates and yen rates, and the lower the yen goes, and the higher interest rates go, the lower the yen goes because the yen is mostly Japanese government bonds. Anyway, and the Bank of Japan owns, I think, over half of the Japanese government bond markets. So what is the Bank of Japan to do? They cannot do anything beyond sudden selling of dollars and buying of yen, which only works for a few days, and the market absorbs it, and the yen weakens further, which is why we are at a 1990, how old am I, 30, that’s 33, 34, 34 year low.

I’m not 34. I was born in 1983. I’m 40. What does that have to do with anything? And so I’m not much of a conspiracy theorist, but I do know that when you want to make a 65 billion dollar sale, you don’t announce it to the entire damn world before you’re going to do it a year in advance. Why would any woman want to do that? I think something else might be going on here. Maybe the Bank of Japan is trying to force the Fed to lower interest rates so that it can save the yen because there’s nothing else that it can do.

And once the yen falls, the entire Keynesian system falls because the queen or king or emperor of Keynesianism is not really the Federal Reserve. It’s the Bank of Japan because they have a debt to GDP ratio of something like 265% or some insane number like that. And when they really get into something, the Japanese really get into it. Now, I want to show you one more table, not a chart, a table. This is the tick figure is Treasury International Capital. And who is I’m going to minimize my face here and who is the number one owner of Treasury bonds, Treasury International Capital means how much bonds, Treasury bonds, U.S.

bonds are owned by foreign countries. And who is number one? That is Japan. Number two, a distant number two at seven hundred and seventy billion is China mainland as opposed to China, not mainland, which is Hong Kong. I think Japan owns one point one five trillion dollars. And they are pretty much the only ones who have been significantly adding to their stockpile of treasuries since last year. It’s not even that significant in Japan. They had one point one two five trillion at April twenty three, now one point one five trillion. So that’s about twenty five billion dollars in addition to their huge stockpile.

China has been selling off like a mother. I don’t know how mothers sell off that much. But anyway, we have eight hundred and sixty nine billion dollars in April twenty twenty three and now seven hundred and seventy billion dollars. That’s all for you. Chabadniks out there. That’s your favorite number. And so it seems that we have come to the point where the Federal Reserve’s raising interest rates has infected more than its own banking system and has infected the Japanese banking system, which is the most fully saturated with Treasury bonds in the world at one point one five trillion dollars.

So it’s no surprise that Japan was the first foreign banking system to be affected by the rise in U.S. interest rates. And now the Nunchuk Norvin Chuken something something bank. Do not try it is losing one point whatever trillion yen, give or take a hundred billion yen on either side or whatever. And the yen is at thirty four year lows. And once it breaks those lows, it’s going to probably fall a lot harder and a lot faster. And the Keynesian experiment that is centered in ground zero in Tokyo will come to a nuclear and probably not immediately.

But it’s another step in that direction. If you enjoyed this video, then sign up for the end game investor on Substack, where you can get this sort of tone in financial commentary just in written form, which is what I’m pretty good at. And if you want access to my Patreon playlist, then sign up to my Patreon on Patreon for as little as three dollars a month. The next thing I’m covering is ancient anti-Semitic jokes from Rome. I found a whole page of them. They’re really funny. And some of them have to do with money.

This is Raffi of The Endgame Investor. You can find all the links in the bottom of the description below. And I’ll see you guys at Chris’s channel on the Weekly Silver Report. Konnichiwa. [tr:trw].

See more of Rafi Farber on their Public Channel and the MPN Rafi Farber channel.