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Dan Tapiero highlights a striking development in the Japanese markets where 2-year notes have dipped below 1% for an astounding 30-year duration. This effectively meant money was almost free in Japan for three decades.
As a result, the Nikkei index has finally surpassed its 1989 peak, when 2-year notes had a significantly higher rate of 8%. Tapiero remarks on the drastic reduction in the purchasing power of Japanese savers compared to other assets. Consequently, there is a noticeable panic shifting towards gold and Bitcoin as preferred stores of value.
The dramatic shift in Japan’s monetary landscape not only underscores ongoing concerns regarding central monetary policy but also reflects broader themes of transformation in global finance. These developments resonate with themes explored in Dan Tapiero’s earlier assessment of the markdown of the old world, where prolonged low interest rates and shifting asset preferences signaled deeper, structural market adjustments. For a more comprehensive perspective, see Tapiero's analysis in "Dan Tapiero warns of a marked down old world."