In the coming years, investors should keep a close eye on the foreign exchange markets, particularly the Japanese yen. For years, Japan has been heavily reliant on debt, which is currently at twice the level of ours. The government has also kept interest rates low in an effort to spur economic growth. However, with inflation on the rise, borrowing costs are becoming more expensive and this is putting an end to the era of free money.
The weakening of the yen is already having serious economic and political repercussions in Japan. As one of the largest economies in the world, any devaluation or trade restrictions could set off a chain reaction that would have far-reaching consequences. It’s possible that Tokyo will look to institute tariffs as a way to protect its domestic industries from cheaper imports.
However, Tokyo is not alone in its struggles with currency fluctuations. All currencies are currently experiencing volatility, which could lead to noise about tariffs, devaluations and trade restrictions. This could all be reminiscent of the beggar-thy-neighbor actions of the 1930s that ultimately led to World War II.
As a journalist covering these developments closely, I encourage my followers to stay informed and send me any secure tips they may have about these matters.