Japan's 10-year treasury bond bond yield hit a new high since the 2008 financial crisis! And the warning line is at 2%, once broken, it indicates that the era of low interest rates will end, and we will usher in a chaotic era of high interest rates, high asset pricing, and high inflation! In the past few decades, Japan has been the "ultimate representative" of negative and low interest rate policies worldwide. The 10-year treasury bond yield has been around 0% all year round, and the logic behind it is: ✅ Deflation+aging population ✅ The central bank's unlimited bond buying (YCC: yield curve control) ✅ Japanese yen assets are regarded as a "free fund pool" and widely used for global carry trade arbitrage. Now the yield has soared to 1.6%, which means that the bond price has dropped sharply and the yield has risen. Some people have begun to sell Japanese treasury bond. In the short term, it may be that the market is trying to "dare the Bank of Japan to control the bond market without a bottom line". If it breaks through 2%, it is equivalent to a formal war between the market and the Bank of Japan. In the past many years, Japanese institutions (such as life insurance and pension) will lend funds to the world (US bonds, European bonds, and even US stocks) because of their low returns. Now, if JP10Y can provide a return of 1.6% -2%, there is an opportunity to "make money lying down": one ️⃣ Japanese funds may sell US bonds, European bonds and foreign stocks → return to Japan to buy domestic bonds two ️⃣ US bonds, European bonds, and risky assets may all be under pressure due to reduced liquidity three ️⃣ If the Federal Reserve doesn't cut interest rates soon, the pressure will increase. The awakening of the Japanese bond market is a "debt godzilla" that is not only a matter for Japan, but also a signal of global interest rate and capital structure repricing. Be cautious and prudent ⚠️