Arthur Hayes: Rising Japanese government bond yields may weaken Japanese funding support for US Treasuries.

Arthur Hayes wrote that Japan's second-largest bank plans to significantly increase its holdings of Japanese government bonds (JGBs) after the yield fluctuations subside. He stated that as JGB yields rise, Japanese investors may be more inclined to allocate funds to the domestic market, thereby reducing their investment in US Treasuries. This will affect the ability of Japanese funds to continue providing financing support for "Pax Americana".