The global bond market is collapsing right now

🚨 The global bond market is collapsing right now

The 40-year “alternative period” is over. The U.S. 30-year Treasury yield is 5.01% and Japan’s 30-year Treasury yield is 3.195% at an all-time high. What’s more shocking is that Japan’s 10-year Treasury bond yield has soared 49% (price has fallen) over the past year.

🤔 Why is this happening now?

The root cause is that the three structural cracks burst at the same time.

✅ Structural Return of Inflation – New Era of Inflation Begins With Tax Evasion and Supply Chain Reorganization
✅ Realization of fiscal domination – US national debt of USD 35 trillion, debt-to-GDP ratio of Japan surpasses 236%
✅ Collapse of global liquidity supply system – Quantitative tightening of central banks and evaporation of global demand

💥 But there’s a surprising twist going on here.

The relief pitcher brought up by U.S. and European policy authorities is the stablecoin. The $230 billion stablecoin is currently expected to grow to $2 trillion by 2028, creating $1.6 trillion in new demand in the government bond market.

☠️ But this is a dangerous experiment.

If investor confidence disappears, there is a risk of “defegging,” and large-scale repurchases can rather amplify government bond market instability. This is illustrated by the case in which USDC plunged to $0.86 during the bankruptcy of Silicon Valley Bank in 2023.

💰 The most shocking fact is this.

As the 25-year negative correlation between stocks and bonds collapsed, the traditional 60/40 portfolio lost more than its 100% share portfolio for the first time in 150 years, meaning government bonds are no longer a safe asset.

⚔️ We are now at a significant turning point in financial history.

The clash between digital currency and traditional finance is in full swing. Time will tell whether stablecoins will become a savior or Trojan horse in the government bond market, but what is clear is that this is a key variable that will determine the fate of the financial system in the future.

🌏 Investors now need a fundamental review of their strategy.

With bonds no longer serving as safe assets, it is time to think deeply about real assets such as gold and inflationary hedge assets.