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The story
The yen surged in New York foreign exchange trading on the morning of the 2nd, briefly touching the upper-158 range against the dollar. The previous day it had fallen to the upper-160 range — its weakest level since the yen-buying, dollar-selling intervention at the end of July — making for an unusually volatile stretch. Behind the swings: wariness about further currency intervention and growing expectations that the Bank of Japan will accelerate its pace of rate hikes. Details of a meeting between BOJ Governor Kazuo Ueda and US Treasury Secretary Bessent also fed into market sentiment. On 5ch, a thread on the topic sparked a back-and-forth over unrealized gains on Japan’s US Treasury holdings — “we’re making money” versus “it’s meaningless if you can’t sell it” — while opinions split over whether the yen is headed weaker or stronger from here.
[New York — Yoshikazu Imahori] The yen surged against the dollar in New York foreign exchange trading on the morning of the 2nd, briefly touching the upper-158 range. The previous day the yen had hit the upper-160 range, its weakest level since the yen-buying, dollar-selling intervention that began at the end of July.
Wariness over the chance of further intervention continues to simmer, keeping trading on edge.
Expectations of a faster BOJ rate-hike pace are also weighing on the market. According to details released by the US Treasury Department on the 1st, regarding BOJ Governor Kazuo Ueda and Treasury Secretary Bessent’s 8…(continued in the paid edition, 458 characters remaining)
Source: nikkei.com / Original article here
What people said
Next Monday's definitely gonna be a Monday. (playing on the redundant pairing of 月曜/Monday with the English loanword "マンデー" for emphasis)
Could be tomorrow too, y'know.
If Tuesday shows up on a Monday, that's when it's really bad.
Now it's ¥160, so that's ¥160 trillion. For the coordinated intervention they borrowed dollars against the Treasuries as collateral and spent ¥15 trillion,
leaving ¥145 trillion — a ¥45 trillion profit.
Exactly.
Somehow Japan's ended up hoarding a jaw-dropping pile of dollars.
Not really a good thing, honestly.
But it's ¥160 to the dollar now, right?
That's not the same as when it was ¥100…
Under the DPJ government it was ¥80 to the dollar…
The yen's lost half its value…
They haven't sold anything — they just borrowed dollars using it as collateral.
How do you not get that much?
Japan isn't making any money here.
It just took on debt.
How is it not a profit when ¥100 trillion worth of US Treasuries becomes ¥160 trillion because of the weak yen?
Give me a break.
Because you can't sell it.
Even if the paper value goes up, if you can't cash it in it's the same as scrap paper.
Same story with GPIF (as written: "GRIF") —
they overdid it and now can't cash out either.
On top of it not being real profit until you sell, it's really just the yen's own value dropping…
Think of it like you're standing in America:
from inside Japan it looks like a ¥60 trillion profit.
Say Mr. $1-million bought in for ¥100 million and held on — convert it back now and it's ¥160 million.
Almost nobody says "the yen lost half its value." Everyone just says "lucky, made an extra ¥60 million."
Are you the type who's grateful to [former PM] Hatoyama for buying up dollars back when the yen was strong?
So what are you actually going to do with the profit?
If it's such a sure thing, why even borrow from the US in the first place?
Let's hurry up, pay back the US debt, and figure out together what to do with the winnings.
Japan's self-sufficiency rate is low, so it ends up importing stuff with a weak yen regardless.
The dollar's gonna turn into scrap paper.
Something like the All Country fund should be fine.
As long as [PM] Takaichi stays in charge, there's no reason for the yen to strengthen.
Well, the US will cut rates.
They're going as far as coordinated intervention just to push the yen stronger.
They doubled the ceiling on the rate cuts.
Ordinary Americans are going to end up homeless even faster.
US inflation is still comfortably above 3% — are they really going to cut? That'll just make inflation accelerate even more.
Cutting rates after the Lehman Shock caused inflation???
Looking at the inflation trend, isn't today's inflation from the COVID stimulus handouts?
Don't you know about America's QE2 after the Lehman Shock?
Everything started from there.
Look at the inflation rate — it's clearly post-COVID?
No, QE2 is the whole story.
That's when everyone realized it was fine to push stock prices up excessively through monetary easing.
Sure, the COVID handouts were more than enough to wreck confidence in bonds — i.e. in money itself.
But if you're talking about the actual starting point, the shift in the whole mood of US fiscal policy
might really trace back to Bernanke.
Because it'd expose all the "Japan's about to collapse" doom-mongering as a scam.
Because monetary policy isn't something you do for the sake of the exchange rate.
Because inflation isn't really that high to begin with.
Looking at the trend graph, the trigger looks like COVID to me? Stock prices too — after the Lehman Shock they climbed pretty calmly, and it's only since COVID that they really started spiking.
https://ecodb.net/exec/trans_country.php?type=WEO&d=PCPIPCH&c1=US&c2=JP
Doesn't matter what you bring up or write — it's pointless.
QE2 is everything.
My position isn't changing.
Sure, in your own head, maybe.
I've been saying that the whole time, you know.
You've been asserting that firmly since post 157.
If you're not going to listen, there's no point talking — you've already decided, in your own head. Only in your own head, but still.
157 Nanashi Donburako (default anonymous handle on this board) 2026/09/03 (Thu) 09:27:19.58 ID:vzhid9gs0
Re: #156
Doesn't matter what you bring up or write — it's pointless.
QE2 is everything.
My position isn't changing.
Back then everything was cheap and life was easy…
If the DPJ ever got back into power, would vending machine drinks go back to ¥120, beef bowls to ¥300, high-end graphics cards to ¥100,000, and cars to ¥2 million?
At this point, if they just stopped bringing in foreign workers, supply and demand might actually balance out.
Background and Key Points of the Discussion
The sharp swings in the yen trace back to the yen-buying, dollar-selling intervention carried out at the end of July, and the market’s reaction in the aftermath. Intervention is meant to curb excessive currency volatility, but its effects tend to be short-lived, and the market ended up cycling unstably between a slide back to the upper-160 range and a sharp rally to the upper-158 range within a short span. The “unrealized gains on US Treasuries” argument that lit up the thread points out that even with holdings unchanged, their yen-denominated value swells as the yen weakens — but it’s easy to overlook that this isn’t a realized profit unless the bonds are actually sold and converted into yen, and it’s an entirely separate matter from the real strength of Japan’s overseas assets or confidence in the yen. Meanwhile, expectations of faster BOJ rate hikes and Japan’s expansionary fiscal stance can pull the exchange rate in opposite directions through interest-rate differentials, which is why opinions in the thread were split over whether the yen is headed weaker or stronger.
*This article is compiled as an excerpt and summary of the 5ch (Breaking News Plus) thread “[Forex] Yen Surges, Briefly Hits Upper-158 Range — Wariness Over Intervention, Faster BOJ Rate Hikes.”
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