Tokyo cannot raise yields without blowing up its budget and cannot hold them down without crushing the yen and investors are piling into the debasement trade

Japan's government says it may "intervene" before the Japanese Yen to US Dollar ratio reaches 160. Over the last 2 months, the Yen has gone from 145 to 157 as a $110B+ stimulus package is coming
byu/RobertBartus inEconomyCharts

I agree, but does it really solve anything for Japan? With all the helicopter money, a demographic that is slowly dying out (and accelerating after 2030, plus the hikikomori issue, etc.), this stimulus package is surely not the last one, maybe just the last for this prime… pic.twitter.com/clEY6NBP6M

— 구미호 (@ThinkInError) November 21, 2025

This is where the “debasement trade” comes from. Japan’s debt at 240% of GDP leaves no good options. If Japan stabilizes the Yen by allowing yields to rise, there’s a fiscal crisis. If it keeps rates low, the Yen goes back into a devaluation spiral. Too much debt is a killer…

This is where the "debasement trade" comes from. Japan's debt at 240% of GDP leaves no good options. If Japan stabilizes the Yen by allowing yields to rise, there's a fiscal crisis. If it keeps rates low, the Yen goes back into a devaluation spiral. Too much debt is a killer… pic.twitter.com/A7SymtTT4h

— Robin Brooks (@robin_j_brooks) November 21, 2025

Japan printing $135 Billion stimulus to "help people cope with inflation".

Economists are unserious people.https://t.co/t7ARgnZLLb

— Phil Bak (@philbak1) November 21, 2025