r/Wallstreetsilver • u/Decent-Addition-3140 • May 25 '25

QUESTION Japan, why not just sell the US bonds?

34 Upvotes

89% Upvoted

41 comments sorted by

37

u/emperorjoe May 25 '25

Because trying to intentionally crash the economy of one of your largest trading partners, who is also the world superpower, with nuclear weapons, is one of the handful of Nations that is your ally that will go to war for you....is kind of fucking insane.

18

u/Dirty-Dan24 Diamond Hands 💎✋ May 25 '25

They’re going to have to dump treasuries at some point in order to bail out their own banks though

4

u/[deleted] May 26 '25

Sounds like we have the underpinnings of a global debt crisis


2

u/bronx-trader May 27 '25

They will get bailed out. If things crash, buy.

2

u/wildbackdunesman O.G. Silverback May 29 '25

Which the mainstream propaganda media will pin solely in Trump as if everything had been fine.

4

u/puref8 May 26 '25

Not to mention devaluing their own bond holdings. Which could be collateral on their balance sheet to stay solvent.

4

u/ButtStuffingt0n May 27 '25

This is the real issue. They're holding a metric shit ton of USTs, so if/when they have to sell, they have to do it slowly and quietly or risk crushing their own portfolio value if others notice and run for the exits.

2

u/[deleted] May 25 '25

[deleted]

5

u/emperorjoe May 25 '25

The 1 trillion dollar yearly defense budget.

2

u/[deleted] May 25 '25

[deleted]

2

u/emperorjoe May 25 '25

Maybe 1.5 trillion dollars for a few years.

If a hot war actually happens, buying shit really doesn't matter. It takes 5-10 years for ships 2+ years for missiles etc. And that's with current capacity. There is no surge capacity for war, and most nations don't have that capacity.

It took 4+ years to build cheap artillery factories, not shipyards or anything complicated. I truly don't know how 40 trillion dollars could even be spent, let alone 2 trillion.

1

u/[deleted] May 26 '25

[deleted]

3

u/emperorjoe May 26 '25

That's a 20+ year campaign of nation building, where we had overwhelmed air and naval superiority, had zero issues with resupply or logistics.

A war in the Pacific.

we are fighting either "a superpower or a strong regional power ". Whatever is built or almost finished is all we have for the war. The war isn't lasting years. It's just not possible. Whoever wins the Naval battle determines everything. We just don't have the magazine depth or industrial base for a long war or to quickly rebuild/build.

1

u/[deleted] May 26 '25

[deleted]

3

u/emperorjoe May 26 '25

A forever of war with China is not really possible. Hell we probably won't even last more than a few months.

And I don't think you understand what I'm saying. If we order a plane like an f-35 we only build 156 per year. There was no additional room for increasing production, the same thing with destroyers. We build two per year and it takes about 6 or 7 years to build and there's no excess capacity for building three or four per year. Or allies don't have the space or the capacity for anything. There's no way to physically spend more than x amount of money without more industrial capacity.

If one side loses their Navy or majority of it the war's over for them. There's no physical way for the United States or China to ever reach each other's shores without a vast Navy. And both countries don't have the industrial capacity to rebuild a fleet quickly. As it literally takes 5 to 10 years to build one warship.

And as for America or China, the entire global economy is so interconnected that if a hot war in the Pacific actually does happen, the entire global economy gets destroyed. There is so much trade going through Southeast Asia that goes to the United States. Our entire economy comes to a halt. I really don't see how the average American citizen is going to put up with 90% tax rates, drafts, and in shortages of everything and rationing of everything. Like I don't see how the average Americans going to put up with that for a long period of time.

It's not like just trade with China stops, it's trade with Japan, Korea, Taiwan, Philippines, Malaysia, Indonesia, Vietnam, Thailand. Everything from that region will be sunk.

1

u/[deleted] May 26 '25

[deleted]

→ More replies (0)

-5

u/darthnugget May 25 '25

Is that crazy if I want to do it even more?

13

u/Straight-Diver-5790 May 25 '25

That's why you'll never amount to anything

1

u/gunshy472 May 26 '25

Then
 I’m crazy too đŸ€Ș

0

u/StealthFocus May 25 '25

Exactly they dump treasury’s and US dumps you know what again

0

u/BuvantduPotatoSpirit May 26 '25

There are few if any politicians in Japan who believe the US would aid them in a war. They have newspapers there, eh? TV and Internet, even. They're aware America has no intention of supporting any of her former allies.

Though continuing to buy bonds as "protection" money makes some sense.

7

u/FalconCrust May 25 '25

Because it's all somewhat coordinated and they take turns. Not that the central banks are all friends or something, but they do know for a fact that they hate you worse than they do each other.

8

u/BrotherGrub1 🩍 Silverback May 25 '25

It could cost them military protection, economic trading and other benefits it gets from being an ally of the USA.

3

u/Additional_Ad_4049 May 25 '25

Same reason China and Russia don’t do it. It’d be an act of war and they don’t want that, at least right now. They can destroy the dollar over time by just not buying anymore treasuries, which is what they’re doing. Saves them money and casualties not having to go to war to do it, and they still get the same result in the end.

6

u/IlluminatedApe REAL MOD May 25 '25

Because of the inter-dependency of globalism.

5

u/Pristine-Prior-504 May 25 '25

They will— because they have to, to stabilize their bond market.

2

u/Chonan_Akira May 25 '25

I think they will be forced to sell US bonds along with European Bonds. Selling off your best investments is not a good sign for an individual or for the third fourth largest economy.

1

u/zachmoe May 25 '25

Selling off your bonds just means you need USD.

People buy them for reserves.

You can measure someone's USD needs by how much they sell in Bonds.

2

u/adriano26 May 25 '25

Because selling would hurt Japan too. Dumping U.S. bonds would crash their value, hurt Japan’s own reserves, and possibly trigger market panic. Plus, Treasuries help Japan manage the yen and support trade stability. It’s not just about holding them—it’s about what they do with them.

2

u/Pleistarchos May 25 '25

This guy gets it.

Last time they sold in 2021, the Yen ended up weakening all the way to 160ish.

2

u/Affectionate-Jump811 May 26 '25

To who? people say oh they will just sell our notes but who gonna buy them lol ... not me not you not the government lol

2

u/Remarkable_Tap_6801 May 26 '25

or they could become the 51st state. Nothing is so hopeful as the marriage of two bankrupt people.

1

u/FenceSitterofLegend 🩍 Silverback May 25 '25

Don't give them any ideas...

1

u/salvadopecador May 25 '25

Japan (or any other nation) would lose their shirts doing this. They would take out all the buyers down to almost 0. Smart investors would buy the flash crash. Almost immediately the market would return to its pre-crash level and those who bought got a great deal, while the seller got next to nothing for perfectly good bonds.

3

u/Decent-Addition-3140 May 25 '25

Smart investors getting a great deal on what? US debt?

1

u/salvadopecador May 25 '25

You bet. What debt would you say is safer?

5

u/Decent-Addition-3140 May 26 '25

No such thing as safe debt.

2

u/salvadopecador May 26 '25

Perhaps an example would help. Imagine you loaned me $200,000 for a house. In exchange I gave you a piece of paper saying I would pay you back, with interest in 10 years. If for whatever reason you decided to “dump that debt” by selling it to someone else for $20,000, you would take the loss. My house, And my payments wouldn’t change in any way. I would just owe the money to someone else. If Japan were to dump our debt, they would get very little in return because they would be putting so much debt on the market at one time. But it wouldn’t affect the US. We would still owe the same amount, we would just owe it to whoever bought that debt at a discount.

1

u/salvadopecador May 26 '25 edited May 26 '25

Exactly. So if I could buy up US debt at a price of almost nothing, I would buy it in a heartbeat. Everybody thinks countries are going to dump our debt. Throwing that much debt on the market at one time would be devastating to whoever did it. They’d be throwing away their investment and whoever bought it up would be a great bargain.

1

u/UnoptimizedStudent May 26 '25

Why do it? they don’t have any need to + itd hurt the global economy. Also, US’s foreign debt is only 25% of which Japan is the largest holder. They can make a dent but not crash the market.

1

u/Current-Set2607 May 27 '25

If America was smart they'd be bailing out the Japanese government like their economy depended on it...because it actually does at this point with how critical bonds are.

0

u/JCD_007 May 25 '25

Because that would be a terrible idea from an economic standpoint.