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US Treasury undertakes historic intervention in yen market

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Re: US Treasury undertakes historic intervention in yen market

#171

Post by iamnothere »

estearum wrote: post #168
iamnothere wrote: post #157

Earlier quoted context omitted.

Two things can be true at the same time: Americans dislike the status quo, and they don’t support angry/negative Democratic politicians for President. See also: claims that Sanders was “too angry” (lmao), the “Dean scream” smear campaign, characterizing Clinton as a cackling witch, etc.

Yeah nah this is way too reductive. You'd need to share a much more thorough analysis than just "here are three candidates criticized for things that are arguably adjacent to angry/negative vibes" For example, Harris ran on a positivity campaign and lost. There are just way, way too many dimensions to modern politics to resolve into something like this – with the exception of the anti-MAGA sentiment which is widespre…

Well you should try it then. The right wing is doing a better job of disassembling the empire anyway, inadvertently, so I don’t mind too much if they win again.

(FWIW the Dems had an internal report after ‘24 that mostly agreed with me.)

Re: US Treasury undertakes historic intervention in yen market

#172

Post by Freedom2 »

eszed wrote: post #57
Aboutplants wrote: post #39

Earlier quoted context omitted.

Which is hilarious because 5-10 billion dollars worth of Yen is not going to do much in the grand scheme of things. It’s a speed bump not a stop sign.

I believe that would mean 5- year or 10- year , as in the terms of the bonds. No amount disclosed.

You are completely wrong, the photo has "bil" on it.

Re: US Treasury undertakes historic intervention in yen market

#173

Post by ifwinterco »

IAmGraydon wrote: post #37
CamelCaseName wrote: post #35

Wait, no way! Someone posted a zoomed up photo of a US official (can't recall who) of a notepad a few days ago saying "To do: Buy Yen 5Y - 10Y" or something similar

Bessent wrote that note very large and intentionally left it visible in hopes that it would be photographed and the market would do the work for him. If the market believes the US Government is going to spend $10B on JPY, it will happily price it right in without the US having to spend a penny.

These guys never do anything by accident, like when Jamie Dimon said "I probably shouldn't say this, but if you see one cockroach there's probably more".

You don't get to manoeuvre yourself to being the head of JP Morgan by starting sentences with "I probably shouldn't say this" in interviews and then saying something you actually think you shouldn't say

Re: US Treasury undertakes historic intervention in yen market

#174

Post by timacles »

halJordan wrote: post #16
dzonga wrote: post #6

Japan is the sort of canary in the coal mine. so yeah if the yen pops - then the u.s will too given all the 'a.i' shenanigans & the market manipulation with oil. but I guess the US Treasurer is willing to manipulate the market till they can't.

Japan is a what? They've been dumping billions of dollars and trillions of yen into their economy since the 1990s. How is this any different than the past thirty years of intervention? I stg you guys. I get that ginning up a conspiracy gives you agency in a powerless world but come on.

Not really a conspiracy theory, it’s just an indicator of the underlying issues either the global economy. Yeah it’s been red for decades, it just shows there are segment of the world economy that are under high stress.

Difference is US now has its own issues which just makes the overall situation even more fragile.

No one knows for how long or what happens next, but you can’t look at things and think, eh it’s just the way it is. Things are a certain way until they’re not

Re: US Treasury undertakes historic intervention in yen market

#175

Post by estearum »

iamnothere wrote: post #171
estearum wrote: post #168

Earlier quoted context omitted.

Yeah nah this is way too reductive. You'd need to share a much more thorough analysis than just "here are three candidates criticized for things that are arguably adjacent to angry/negative vibes" For example, Harris ran on a positivity campaign and lost. There are just way, way too many dimensions to modern politics to resolve into something like this – with the exception of the anti-MAGA sentiment which is widespre…

Well you should try it then. The right wing is doing a better job of disassembling the empire anyway, inadvertently, so I don’t mind too much if they win again. (FWIW the Dems had an internal report after ‘24 that mostly agreed with me.)

Well thanks for confirming you're just making shit up from whole cloth.

The Dems' 2024 report literally argues the opposite, over and over. It argues that Democrats did not engage in enough negative campaigning against Trump.

> LESSONS FROM THE STATE CAMPAIGNS 1. Going Negative Works (Especially if Voters Know You).

> The Trump campaign and supportive Super PACs went full throttle against Vice President Harris, but there was not sufficient or similar negative firepower directed at Trump by Democrats.

> Voting is a choice. And negative messaging needs to be a part of the story as choices are framed for voters.

> The Harris campaign appears to have relied on Trump being unacceptable rather than building an affirmative case for Harris. Base voters needed reasons to vote FOR Harris as well as against Trump. Without an effective contrast with a difficult (and unaffordable) status quo, the obvious contrast with Trump was not a sufficient motivator, especially since there was not sufficient negative messaging about how horrible Trump was (and still is) for and to most Americans.

> Define lanes for communications ecosystem. Who will carry contrast and negative messaging so candidates go high as other entities go low. This was a major failing in 2024, and it cannot be repeated. Set the lanes and hold organizations accountable.

Re: US Treasury undertakes historic intervention in yen market

#176

Post by inigyou »

mono442 wrote: post #162
inigyou wrote: post #160

Earlier quoted context omitted.

How will the fed do that? What will the side effects be? Why didn't it do that at the latest FOMC?

Qe, yield curve control or possibly other market operations. There won't be any real consequences, it's just an asset swap. They buy bonds and in turn create new interbank reserves.

If there are no bad consequences, why haven't they done it yet?

Re: US Treasury undertakes historic intervention in yen market

#177

Post by iamnothere »

estearum wrote: post #175
iamnothere wrote: post #171

Earlier quoted context omitted.

Well you should try it then. The right wing is doing a better job of disassembling the empire anyway, inadvertently, so I don’t mind too much if they win again. (FWIW the Dems had an internal report after ‘24 that mostly agreed with me.)

Well thanks for confirming you're just making shit up from whole cloth. The Dems' 2024 report literally argues the opposite, over and over. It argues that Democrats did not engage in enough negative campaigning against Trump. > LESSONS FROM THE STATE CAMPAIGNS 1. Going Negative Works (Especially if Voters Know You). > The Trump campaign and supportive Super PACs went full throttle against Vice President Harris, but t…

Ah, I had read a source that characterized it this way, but the truth is more complicated. The report itself said this, but it reflected only the view of the author; the notes from Dem leadership on the report disputed this point in particular and said there was no evidence for it. Apparently they disagreed with the report’s conclusions enough to suppress the release for a while.

I misremembered this and a quick search to remind myself wasn’t adequate. Given the disagreement around the report, I don’t think it serves as a good source either way.

Digging a little into it, the research seems to indicate that there’s not adequate evidence to draw any conclusions: https://link.springer.com/article/10.1057/s41253-019-00084-8. Although there’s some evidence that negativity demobilizes voters and degrades democracy, which you probably don’t want. But I don’t really care who wins anyway, I’m not sure why I’m even engaging here. I guess I just want the 2008 Democratic party back.

Re: US Treasury undertakes historic intervention in yen market

#178

Post by don_esteban »

jordanb wrote: post #126
don_esteban wrote: post #114

Earlier quoted context omitted.

Because Japan would sell its treasures to buy dollar with which to buy Yen, pushing the yield on US treasures even higher, speeding up the debt spiral. Similar as the credit-swap lines for the Gulf countries: They have enough treasures to sell to cover their cash flow problems (from the blocked Hormuz), but (see above).

No it would not. * Japan needs dollars to buy yen. * Japan sells US bonds to the US Fed in exchange for dollars * Japan uses the dollars to buy up Yen adding Dollars to the market and reducing the number of Yen. Versus: * The US Treasury uses Dollars to buy Yen on the open market injecting the same number of dollars and removing the same number of Yen * Now the US Treasury owns a bunch of Yen it didn't want. * The US…

1. US actually bought Yen with Euros, not with dollars. The time will tell whether that will be a good trade for them.

2. What do you mean by 'No it would not'? I am not sure what are you trying to say. If Japan sells US bonds (instead of, as usual, buying), the aggregate demand for US bonds will go down, raising the yield. It seems that that is what the US is trying to prevent.

Re: US Treasury undertakes historic intervention in yen market

#179

Post by ethbr1 »

Projectiboga wrote: post #156
hn_throwaway_99 wrote: post #101

Earlier quoted context omitted.

As someone who hasn't followed this closely, when/why did things switch? Japan had the opposite deflation problem for years (decades?) and IIRC tried battling that with "money printer go brrrr" for a long time. How did inflation become their primary problem?

The "Yen Carry Trade" has been a popular way to fund speculative plays in the financial markets. https://www.stonex.com/en-us/insights/the-yen-carry-trade-is...

Luckily, the current technology equity market has sound fundamentals and lacks speculative opportunities.

Re: US Treasury undertakes historic intervention in yen market

#180

Post by jordanb »

don_esteban wrote: post #178
jordanb wrote: post #126

Earlier quoted context omitted.

No it would not. * Japan needs dollars to buy yen. * Japan sells US bonds to the US Fed in exchange for dollars * Japan uses the dollars to buy up Yen adding Dollars to the market and reducing the number of Yen. Versus: * The US Treasury uses Dollars to buy Yen on the open market injecting the same number of dollars and removing the same number of Yen * Now the US Treasury owns a bunch of Yen it didn't want. * The US…

1. US actually bought Yen with Euros, not with dollars. The time will tell whether that will be a good trade for them. 2. What do you mean by 'No it would not'? I am not sure what are you trying to say. If Japan sells US bonds (instead of, as usual, buying), the aggregate demand for US bonds will go down, raising the yield. It seems that that is what the US is trying to prevent.

Either they spent euro reserves or bought euros with dollars so that's kinda irrelevant.

This thread kicked off with an incorrect belief that Japan had leverage over the US with some threat to spend reserves. That leverage doesn't really exist because it can not have any more effect on the American fiscal position than the one the Treasury just took.

In fact the Treasury is helping Japan maintain a stronger fiscal position by not forcing them to liquidate reserves to protect the yen.

Instead the Treasury is using it's own balance sheet to protect the yen which is bonkers from a monetary "america first" perspective and it only makes sense within the context of the Trump administration protecting the Takaichi government from a crisis caused by Trump's war in Iran.

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