Jul. 24 at 4:03 PM
$GLD $GDX $JNUG $B $SLV
Japanese demand for govt bonds is picking up again
In June, Japanese insurers bought
$3.9B of long-term govt bonds—the biggest monthly purchase in 3 yr—after selling
$1.2B the month before
If this trend continues, more Japanese money could stay @ home instead of flowing into U.S. Treasuries/U.S. stocks
That matters because higher Japanese yields make domestic bonds more attractive, which could mean:
➡️ Less foreign demand for U.S. govt debt, making it more expensive for the U.S. to borrow which is currently being seen now
➡️ Less Japanese investment flowing into U.S. stocks
This comes as China has steadily reduced its holdings of U.S.
Treasuries—from roughly
$1.3 trillion @ its peak to just over
$500 billion, lowest level since 2008
If 2 of the largest foreign buyers continue buying fewer U.S. Treasuries, the U.S. will have to rely more on domestic buyers/offer higher yields to attract investors& likely debt monetization w/a lower standing of living
