This is the sort of thing that we last saw in 2008. Not that it was this bad back in 2008.
Something just shifted deep inside the global financial system — and almost no one is explaining what it means for you.
Japan’s 30-Year LSEG Government Bond just hit a historic high yield of 3.427%.
Worse, Japan’s 10-year government interest rate just spiked to 1.84%, the highest level since 2008, jumping more than 11% in a single day.
That doesn’t sound dramatic on the surface. It is.
For 30 years, Japan was the quiet engine that kept the world’s debt machine running. Their interest rates were near zero. That meant banks, hedge funds, and governments could borrow cheap money from Japan and pour it into U.S. bonds, stocks, real estate, and everything else that now feels permanently expensive.
That cheap money kept:
- Mortgage rates lower
- Stock markets higher
- Government borrowing easier
- Credit cheap and plentiful
- That era is now ending.
Translation: interest rates are finally going to start climbing. And by climbing, I mean by a LOT. I can remember when they were 17 percent. No one is financing new cars at 17 percent, and home prices will be coming down hard if the central banks can’t find yet another can to kick.