It can truly be said that a storm is brewing, with the wind filling the buildings! One would have thought that the transfer of Japanese equity and the sharp devaluation of the yen would have already satisfied the voracious wolves of Wall Street. However, less than a month later, Japan is facing a crisis once again, with the exchange rate experiencing a six-day drop, reaching a low point of 159.

Even the banks in Japan are on the verge of breaking. The top five banks in Japan at the end of the month, the Central Union of Agricultural Cooperatives, are expected to suffer a loss of 1.5 trillion yen, and at the same time, they will sell 10 trillion yen worth of bonds in a self-rescue effort. Is Japan about to face a complete collapse of its financial system? Is Japan going to be the first course served by the United States?

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The yen's sharp devaluation and the banks' crisis

Being an adversary of the United States is dangerous, but being an ally is even more miserable. One would have thought that Japan's servitude would换来 the United States' leniency. However, it was unexpected that not only would the United States not let go, but it would also intensify its actions, and Japan may become the first course for the United States.

Recently, according to relevant media reports, in the context of the United States' interest rate hikes, not only are American banks struggling, but Japanese banks are also on the brink. The fifth-largest bank in Japan, the Central Union of Agricultural Cooperatives, has announced an expected loss of 1.5 trillion yen. In order to save itself, it will sell 10 trillion yen worth of bonds.

It is important to note that this bank's asset scale has reached 840 billion US dollars, and this time, in order to save itself, it is going to sell more than 60 billion US dollars' worth of U.S. debt at once. For this bank, it is almost at the edge of life and death. Because a bank using nearly 1/10 of its assets for self-rescue indicates that it is almost at the end of its resources.

We all know that the United States still maintains high interest rates, and its bond yields are also high, which naturally means that the price of U.S. debt is relatively low. Selling at this time is equivalent to turning a paper loss into a real loss. This is also the main reason for the bank's losses.

From Silicon Valley Bank to First Republic Bank, and now to the fifth-largest bank in Japan, they have all been betting on one thing in the past: that the United States would lower interest rates as soon as possible, and the U.S. debt they hold would gradually turn from loss to profit. However, we all know the outcome; they did not wait for the moment when the United States would lower interest rates, and in the end, they all encountered problems.

This Japanese bank has also made the same mistake, that is, following and believing in the United States. However, it did not expect that the United States would be even more ruthless this time, directly exceeding everyone's expectations by extending the interest rate hike cycle to the present. This may also be one of the goals of the United States.After all, for the United States, raising interest rates is not only to create a scarcity of dollars and trigger debt crises in developing countries, but also to use the rate hikes to cause a significant increase in U.S. Treasury yields, a substantial drop in Treasury prices, and thereby reap profits from other financial institutions. Japan's fifth-largest bank is just one of them.

Moreover, as the U.S. interest rate hike cycle extends, I believe that Japan's fifth-largest bank will not be the last; there may be even more. After all, the current scale of U.S. national debt is around $34.7 trillion, and how many of these are equivalent to the Agricultural, Forestry, and Fishery Central Cooperative Banks?

Furthermore, at the same time as the Japanese bank's crisis, Japan's exchange rate is becoming increasingly impatient. After the Bank of Japan injected 9 trillion yen into the market, the yen exchange rate once reached a level of around 152. However, not long after, the yen exchange rate once again faced a six-day losing streak and even broke through the 159 mark, approaching the previous level of 160, which was primarily aimed at Japan's market intervention.

This puts Japan in a pincer movement. It is common knowledge that while Japan's foreign exchange is Japanese, it does not necessarily mean that Japan has the final say.

Moreover, Japan previously took direct action to save the market by injecting 9 trillion yen, of which nearly $37.5 billion was obtained by selling U.S. Treasuries. How much will the Bank of Japan sell this time?

In addition, there is now the added factor of Japanese banks selling off their holdings. With these transactions, Japan will have to sell at least tens of billions of dollars' worth of U.S. Treasuries, which would be a significant blow to the United States. Would the U.S. agree to this?

At the same time as the Bank of Japan's crisis, the United States has increased its fiscal deficit budget, with a year-on-year growth of nearly 27%, and the deficit scale has reached $1.9 trillion. This means that the United States needs money more than Japan does right now. Under these circumstances, would the U.S. allow Japan to sell?

Will Japan be sacrificed?

There are no permanent allies, only unchanging interests. Where there are interests, there are allies. If cooperation does not bring positive returns, allies can also become blood bags. This is quite normal for the United States, but unfortunately, this time it might be Japan.

We all know that the purpose of the dollar tide is to reap profits. However, have we heard of any relatively wealthy country falling yet? We have not. This has led to a situation where the United States has not only failed to gain an advantage but has also suffered losses. While the U.S. might tolerate this situation, can other countries around the world endure it?Because this U.S. harvest is bearing nearly $1.15 trillion in interest for a year, the longer the interest rate hike lasts, the larger the scale of interest growth, and the greater the cost the United States has to pay. If calculated over two years, the United States would need to harvest at least $2.5 trillion in assets to break even, and to fill the $34.7 trillion U.S. debt, the United States may need even more.

More importantly, the United States is currently supporting two large-scale conflicts at the same time, which requires the United States to spend more money. The current increase in the U.S. fiscal deficit is one of them, and this requires debt issuance to solve.

Although everyone knows that the United States will never be able to repay its debt, buying now is a gamble that they are not the last one who can sell. Moreover, the data released by the U.S. central bank this time shows that the estimated amount of U.S. debt purchased by overseas capital in April has plummeted, and Japan, the United Kingdom, and Canada have sold nearly $70 billion in U.S. debt.

For the United States, this is equivalent to loan withdrawal. And will Japan dare to withdraw loans from the United States again when it is on the brink of the cliff? And for the current United States, what's the difference between eating other countries and eating Japan?

Previously, Japan's five major trading companies transferred nearly 10% of their equity to Buffett, and now Japan is facing a shortage of dollars again. I'm afraid Wall Street capital will not let go, after all, they can even eat their own banks, let alone Japan's?

Moreover, the United States will send high-level officials to visit Japan, asking Japan to continue to cooperate with the United States in sanctioning our semiconductors. Under this situation, does Japan dare to resist?

For Japan, the most comfortable posture is the United States being strong and China being weak, and the most uncomfortable is China being strong and the United States being weak. After all, the United States is impossible to gamble with itself, and Japan is more suitable. Bank explosions and exchange rate plummets may just be the beginning, and it is also possible that stocks, bonds, and exchange rates will all be killed in the future.