Arthur Hayes Highlights Japan's Rising Bond Yields Could Weaken Japan’s Support for U.S. Treasuries

Arthur Hayes noted that Japan’s second-largest bank plans to significantly increase its holdings of Japanese government bonds after yield volatility stabilizes. As Japan's bond yields rise, investors there may prefer domestic investments, decreasing their purchases of U.S. Treasury bonds. This shift could reduce Japan's ability to finance the U.S. through Treasury buying, impacting the broader global financing structure known as the 'Pax Americana.'