How Japan’s Broken Bond Market Is Threatening Your Wealth—What You Must Know

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Jan 24, 2026

They unpack how a shock in Japan’s bond market sent shockwaves through global stocks and crypto. They explain the yen carry trade and why rising yields forced frantic selloffs. They explore margin liquidations, rapid deleveraging, and how psychological panic can collapse asset prices. They outline practical portfolio moves like diversification and short-term debt as protection in unstable markets.

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INSIGHT

Broken Japanese Bond Market

Japan's bond market is experiencing panic selling that raises yields and collapses bond prices globally.
Rising Japanese yields forced investors to unwind carry trades, triggering huge losses across assets like stocks and crypto.

INSIGHT

Crypto Reveals Real-Time Market Stress

Bitcoin's 24/7 trading revealed the sell-off synced with Japan, not unrelated political news like Greenland.
Crypto fell sharply during the yen sell-off, signaling global contagion from Japanese debt moves.

ANECDOTE

Pizza-Shop Example Of Credit Drying Up

Tom uses the pizza-shop worker to illustrate how real people feel shocks when cheap credit vanishes.
Less available debt reduces spending and creates immediate demand contraction for small businesses.

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Welcome back to Impact Theory with Tom Bilyeu! In this eye-opening episode, Tom Bilyeu and co-host Drew dive deep into one of the most dramatic shocks to the US stock market in recent history: how shifts in Japan’s bond market triggered a breathtaking $1.3 trillion loss in value, rippling across the globe.

They break down the complex world of Japanese debt, explain the notorious "yen carry trade," and explore why rising interest rates forced investors to panic sell, collapsing asset prices everywhere. Using relatable analogies—from pizza shop owners to kids borrowing money from mom and dad—Tom Bilyeu makes sense of why these macroeconomic tremors affect real people and their everyday finances.

Not only do the hosts tackle the domino effect in crypto markets and stocks like Nvidia, but they dig into psychological factors driving market panics, how margin trading can lead to instant losses, and why diversification is a smart strategy in uncertain times. Whether you’re navigating your first investment or wondering if you should stuff your cash under the mattress, this episode arms you with the mental frameworks and practical insights to protect your financial future in a world where monetary order feels increasingly fragile.

Tune in to get clear, actionable advice and a global perspective on what’s really happening—and what you can do next.

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