https://t.co/9Xkp05A1Lj Big change in situation... Unprecedented crisis in Japanese government bonds since 1996! What should individual investors do now? 【Former Goldman Sachs expert explains in detail】 O-chan [Former Wall Street banker] #AIsummary Caution against rising global long-term interest rates and currency depreciation 🔳 Long-term interest rates rising simultaneously in advanced economies Long-term government bond yields are rising simultaneously in Japan, the U.S., the U.K., and various European countries; the speaker argues that a fundamental shift is occurring in the global financial markets. 🔳 Interest rates surged before past crashes Before the 1987 Black Monday and the Japanese stock market decline since late 1989, interest rates rose sharply; the speaker cites the current rise in government bond yields as a warning sign. 🔳 Government bond market is the foundation of the entire financial system Government bonds are IOUs issued by governments; as investors grow more uneasy about fiscal health, they demand higher yields, which increases government interest payments, triggering a vicious cycle of more borrowing and further rate hikes. 🔳 Concern over overall debt expansion in advanced economies Government debt in G7 nations has expanded from about 40% of GDP in 1975 to approximately 130% today; the speaker highlights this as a key difference from past crises—where major countries that once provided bailouts are now themselves facing fiscal problems. 🔳 Analysis of currency system cycles over 100-year periods since 1971 Since the 1971 Nixon Shock, when the link between currencies and gold was severed, government debt expanded significantly; the speaker draws parallels to trends since 1914 and points to a long-term cycle where currency systems are eventually restructured after excessive debt accumulation. 🔳 Resurgent inflation driving bond selling After nearly four decades of low inflation, conditions changed around 2021; bond investors, wary of declining real yields due to inflation, began selling government bonds and demanding higher yields—this is cited as the backdrop for current rate increases. 🔳 Governments face choices: austerity or interest rate suppression If governments reduce spending or raise taxes to cut debt, economic pain will be severe; thus, the speaker predicts central banks will likely continue buying bonds to suppress rates, diluting currency value to ease debt burdens. 🔳 Japan may be the first domino to fall Japan’s government debt exceeds twice its GDP, and the Bank of Japan holds roughly half of all outstanding government bonds—yet long-term rates are still rising. The speaker notes that foreign investors are now viewing Japan as a potential starting point for global debt issues to surface. 🔳 Rising Japanese rates could spill over into U.S. markets As domestic Japanese rates rise, institutional investors will find it less attractive to hold U.S. Treasuries due to exchange rate risk, potentially triggering capital outflows that exert upward pressure on U.S. long-term rates. 🔳 Households face impact from higher mortgage rates and weakening yen purchasing power Rising long-term rates increase fixed-rate mortgages and corporate borrowing costs; conversely, if the Bank of Japan buys more bonds to suppress rates, increased yen supply could erode purchasing power—either way, households bear the burden. 🔳 Holding only cash is the greatest risk In periods of expanding money supply, nominal prices of tangible assets like companies and stocks may rise; thus, fleeing entirely into yen cash out of fear of a crash exposes investors directly to currency depreciation. 🔳 Stocks are not safe either—watch for volatility During transitions in the currency system, economic downturns and sharp stock declines may recur; holding stocks does not guarantee safety. The speaker advises securing emergency funds, avoiding overconcentration in cash, and pre-determining dollar-cost averaging amounts and individual stock holdings. 🔳 Key market indicators to watch Whether Japan’s 30-year bond yield stabilizes in the 4% range, whether the Bank of Japan increases bond purchases, or whether U.S. 30-year Treasury yields remain above 5%—these are cited as indicators for judging shifts in the financial environment. 🔳 Final argument The speaker does not view current bond market movements as a definitive signal of financial system collapse, but rather as a预告 (warning) that the rules governing finance and currency are changing. The conclusion: individual investors should avoid emotional trading and continue prioritizing diversification and sound capital management.