The NEW Yen MONETIZATION Framework
Yen Monetizes Gold
In my client post yesterday, I showed how the $USDJPY kept rising with JGB yields and gold in a very, very strong fractal last year, especially into the end of 2025..
What I have also discussed and written about is how I believe this was obscuring a stealth yen carry trade unwind (we can’t see) by converting yen into GOLD.
Ever since the new Japanese PM entered the scene, the yen has gapped lower and stayed firmly suppressed.
At the same time, growth/tech equities in US have sold off - especially MAG7 & software names.
In the ‘past’, the OLD CARRY TRADE way is one of using yen to buy USD to buy NDX (in its most simplistic terms).
Therefore, a fateful unwind meant the reverse of that trade: NDX>USD>YEN.
My MONEY GOES HOME theme.
Well, I believe the NEW CARRY TRADE is in fact: YEN MONETIZING GOLD.
The mechanics are simply: sell NDX stocks >USD > GOLD or locals just sell yen > gold.
Either way, it is a very strong explanation for the weakness in US equities in tech and strength in gold since September.
As I wrote earlier this week,
“the Japanese are tired of buying a currency that is not devaluing their lives into prosperity and/or that Japanese capital no longer wants to hold junk bonds when gold is being used by countries to settle trade outside of USD, UST & Petrol-dollar (Oil)”
Now, I went done that path as a way to derive the macro event risks ahead which could interrupt the precious metal run.
But now, I want to jump into that big yen spike/USDJPY dump today!
