The Global Leverage Machine Just Lost Its Anchor For decades, Japan’s ultra-low interest rates turned the yen into the world’s cheapest funding source. Investors borrowed in yen, converted it into dollars, and bought up everything from Treasuries to tech stocks. It was mechanical, predictable, and wildly profitable. But in 2024, Japan ended eight years of negative rates. Then they raised again. And again. By late 2025, Japan’s short-term rate had hit 0.5%, its highest in 17 years. That may not sound like much—but going from zero to anything breaks the math of global carry trades. This wasn’t just about hedge funds. The entire global market structure—U.S. debt, tech stocks, even crypto—was built on the assumption that yen funding would always…
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