The Yen Shock That Hit Stocks

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The United States and Japan just did something that they have not done together in almost 30 years. They fired the biggest currency intervention in history. Japan spent about $53 billion in a single day buying up its own currency, the yen. And then, for the first time in literally three decades, America, the United States, joined in. The New York Fed, acting for the US Treasury, started buying yen. Now, here is the part that should make you sit up in your chair or lie down like Winston just did. That same week, a camera caught a photo over the shoulder of the US Treasury Secretary Scott Besson during a cabinet meeting. And on his notepad, he underlined, and it said, to do, and right underneath it it says, buy Japanese yen five to ten billion dollars. So this isn't some crazy rumor. No, this is just facts from the man himself, photo taken over his shoulder. And as the financial media reported, the US was about to step into the yen market. Do you know what happened in the next 40 minutes? Nearly $1 trillion was wiped off US stocks. Not in a month, not in a week, in 40 minutes. And on the other side of the world, in the very same stretch, the South Korean stock market was busy having its single worst month in its entire history. Worse than the 2008 financial crisis, worse than the 1997 Asian crisis. And now most people saw these as separate stories. We have a weird photo of a notepad, a wobble on Wall Street, well, a trillion dollar wobble, what's up between bankers, right? A crash in Korea. But they're not four stories. They are one machine, and it just showed you that there is a crack. And when you understand what's leaking out of that crack, you'll understand why Asia buckled first, why your US stocks got hit for no reason that the news could explain. And most importantly, what to actually do with your money before the next leg of this is gonna unravel. So this isn't me being dramatic. It's literally on Besson's notepad. It's on the bleeding Financial Times, and no one's really connecting these dots for you. So my promise is that by the end of this video, you'll understand the one thing driving all of this. It's got a really boring name, I warn you. It's called the carry trade. And I'll give you a very simple framework to make sure you're on the right side of it and you're not the one paying for it. My name is Felix Breen. That was Winston back there. He was an investment banker, and I was the guy, you know, looking after him. And we're also the founders of the GOAT Academy, where my retired Wall Street mentors have taught tens of thousands of regular investors the same institutional strategies that are normally only ever taught to Wall Street bankers. And I have to be honest with you up front here. This video is gonna be just a little information dance. They're gonna be numbers, they're going to be connections. Most of the financial media simply will not make for you. So today I'm gonna show you the quiet machine that just switched on in plain sight and how to make sure you're standing on the winning side of it, not the losing side, which

Japan And The US Step In

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is unfortunately where most beginners will be. But before we go deeper, I want to say something that really matters to me. Here is the truth that makes me angry, to be honest. When weeks like this happen, interventions, crashes, a trillion dollars gone in 40 minutes. Do you know who actually gets hurt? It's not the pros. No, the pros have seen this movie, they're making money out of it. It's the beginners. It's the people who are newest to this. It's the people who did everything right, they worked hard, they saved up, they finally started investing, and then a week like this comes along and it scares them. And it's the worst possible moment to be scared. It's the beginners who lose their hard-earned money. It's the beginners who end up canceling vacations, it's the beginners who have to push their retirement back a few more years, while the pros are quietly profiting off the exact same event. So our whole mission here at Goat Academy is to level that playing field and to give you the same skills the pros have. So for the first time ever, I'm gonna run a live seminar built purely for beginners. Not the jargon, not the showing off, uh, just the real skills from the ground up. So you never get shaken out like this again. And it's gonna be this Saturday, 9 a.m. Eastern time, New York time, that is. It's completely free, no credit card, no catch. Just show up for yourself. You're a beginner, grab your seat at fasttrackforbeginners.com, fasttrackforbeginners.com. The link is in the description down below. And if you're gonna be there, just write I wanna learn in the comments down below. And I know how many of you are gonna be there. So let me show you why you guys do that, why this week was so very, very important. And oh yeah, you can also download a free research report of everything I'm gonna cover in this video so it can really sink in for you, especially if you're a beginner. Uh, there's a link to down to below to that as well in the description. But let me walk you through what actually happened this week. Calmly, in order, because the sequence is sort of everything to this. Step number one is that for months the Japanese yen has been falling and falling and falling some more. This week it was scraping around about 160 bucks, its weakest level since 1986, right? So it's a four 40-year low. And to put that in kind of human terms, a currency losing value like that is a country's savings leaking out the bottom of a bucket. That was step number uno. Step number dos is on Thursday, Japan said, enough. I wish I knew the word for enough in Japanese, that would be fun, wouldn't it? Um, in a single day, the Japan government spent about $53 billion buying their own currency to prop it up. It's the biggest one-day currency intervention in history. All history. And then we get step number first, which is the one nobody saw coming, the United States joined in. My slide doesn't have a three, does it? Or four. No, anyway, you'll get the point. There is a three in between here, where the good old USA steps in. And what do they do? Well, the Americans didn't sell dollars to buy yen. No, they sold euros, which is the monkey currency of the Soviet republics of Europe, if you hadn't heard about that. Uh, why does that matter? Because the last time Washington and Tokyo teamed up to buy yen, it was in the 1990s. The last kind of coordinated rescue of any kind was 2011 after Japan's earthquake and tsunami. So America stepping in to prop up another country's currency is not a normal thing. It is a flashing red warning line. And as one analyst put it, you don't do coordinated intervention in supposedly free markets unless you know there is a big problem under the hood. Right? So then there is step four, and I found my pen, yay. Um, during a cabinet meeting, a camera called Treasury Secretary Besson's notepad, and he wrote, buy Japanese yen five to ten billion. It's like the Simpsons that we live in, isn't it? Um, so the plan to intervene in a foreign currency was there, it was photographed before it was ever announced. Coincidence? I don't believe in coincidences. And then Reuters reports on it that the US is preparing to step into the yen market, and the SP had been up pretty nicely that day, actually. It was up 0.7%, which was quite nice. And then the report hit. And then in just 40 minutes, we went down to minus 1.2%. Wiped out almost a trillion dollars in 40 minutes. Less time than it takes you to watch this video, on the basis of a currency news about Japan. And that right there is the tell. Why on earth would a bit of news about the Japanese yen vaporize a trillion dollars of American stock value in 40 minutes? That question is the whole point. So let me answer the point for you.

Carry Trade Explained Simply

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To understand why, you have to understand that the yen is not a Japan problem. It's an everyone problem. Because the whole financial system has been quietly leaning on one giant hidden trade. It's a trade so big that hundreds of billions of dollars are borrowed riding on it. It's a trade almost no regular investor has ever heard of, but it's been holding up your stock portfolio, whether you know it or not. And it has a strange name because strange, boring names are the sort of thing people don't talk about, right? People don't ask any questions. They're like, yeah, what is that? Carry trade? I don't know what that means. So let me explain that in a way I can explain it to a 12-year-old, because I think everything should be explained like we're 12 years old, because I think that's about uh my mental capacity. And if you can't explain to a 12-year-old, you probably shouldn't put any money into it. So for years and years, Japan has kept interest rates at basically zero. So you can borrow Japanese money for free. And that's what the big funds do. They borrow a mountain of yen at the top here for basically nothing. It's like being handed a giant 0% interest loan. And then step two, they buy dollars with those free yen. And then step three is they take those dollars and they buy US assets with it, US stocks, US government bonds, right? So they borrow at zero and they invest and they get like seven, eight, nine, ten percent interest, and they keep the difference. Free money. It's literally the secret printing press that Wall Street's been using for decades. And it works beautifully, right? Look at all the billionaires on Wall Street, isn't it wonderful? Look at all the yachts, you know what. Um, but it only works as one thing stays true. The yen has to stay weak, and the yen has to stay free. Because remember, you borrowed in yen. One day you have to pay it back in yen. So if the yen keeps losing value, what you're gonna pay back is less and less and less and less. It's it's like a dream, right? It's a it's Wall Street wet dream. Now, picture what happens the moment that flips. Picture what happens when the yen suddenly gets stronger. Suddenly, that giant loan you took out is now getting bigger. You're gonna have to pay more than you borrowed. So your cheap loan just got really expensive. Very fast. And when you own more, the people you borrowed from make a phone call. That phone call is called a margin call. It means pay us back now. And how do you get the cash to pay them back in a hurry? You sell whatever you can sell fastest. And the most liquid, easiest thing to dump in a hurry is what? US stocks, because you can always offload those pretty quickly. So everyone in this trade rushes for the same exit at the same second, and that's the trillion dollars that evaporated in 40 minutes on Friday. It's not the market deciding American companies are suddenly worthless. No, it is a giant hidden loan being called in all at once. And as one analyst put it, the carry trade is now unwinding in real time. So now you understand the trigger. Japan and America stepped in to make the yen stronger. Good for Japan. But for everyone sitting in that carry trade, a stronger yen is the fire alarm. And this thing is enormous. Hedge funds were sitting in about $10 billion bets against the yen. When the yen jumps the other way, all of those have to be unwound. And they don't unwind it politely, they unwind it very, very rapidly. And here's the honest bit, I'm not going to fearmonger, you see. The intervention this week only nudged the yen from 164 just to 157. Not exactly a huge move. It's a small move. And yet look at the damage it did in 40 minutes. Now ask yourself, what happens if the yen keeps strengthening from here? What if we go to 140 or 130? As one analyst put it, when the two biggest checkbooks on earth fire together and

Margin Calls And The 40 Minute Drop

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the currency barely moves, the warriors that the next leg is a disorderly unwind that pushes up US interest rates and hits US stocks really, really hard. So why did America participate in this? Why did they care enough to break a 30-year taboo and start buying another country's currency? And this is where it connects to everything I've been telling you about the US debt. Japan is not just any country. Japan is the largest foreign holder of the US government's debt on the planet. They're in a mountain of US debt. Now follow the chain. When Japan spends $53 billion in a day defending its currency, where does that money come from? Well, it comes from selling the thing they own most of, US debt. So to defend the yen, Japan may have to sell America's debt. And when the largest foreign holder of US debt becomes a seller, the cost of that debt goes up. US interest rates go up. Higher US interest rates mean it's more expensive for the US government to carry its $40 trillion of debt. So America didn't step in out of kindness to Tokyo. America stepped in because a yen in free fall forces Japan to dump US debt, which pushes American interest rates up, which makes the debt problem bigger, which makes the stock market collapse, which makes investment drop, which makes your mortgage go up and your car loan go up and causes a massive recession. It's all the same machine. The weak yen, the carry trade, the US debt, the intervention, it's one machine. And it coughed a little bit on Friday. It was a trillion dollar cough. Now, why did I mention Korea at the outset? Because Asia sits closest to this fire, and Asia cracked first. In July, the South Korea stock market, called the COSPI, had its worst single month in its entire history. It fell more than 30%. Imagine that. Imagine the Nasdaq dropping 30% in a month. It is worse than the crash of 2008 when it fell 23%. It is worse than the 1997 Asian financial crisis when it fell about 27%. The selling got so violent, they had to hit the emergency breaks that hold all trading on back-to-back days, something that has never happened before in the market's history. Now, part of that was a story about computer chips and too many people betting on the same AI stocks with money they borrowed. I guess they write too much about what the hedge funds are doing. But notice this pattern. It's the same pattern. Cheap borrowed money floods into a hot thing, the trade wobbles, and the borrowed money rushes for the exit all at once. Korea was the canary in the coal mine. It's the smaller, faster market that shows you what happens when that borrowed money unwinds before it reaches the big one. So when you see Korea have its worst month in history and Japan via the biggest intervention history and a trillion dollar vanishes from Wall Street in 40 minutes of the same week, is that a coincidence? Well, you answer that for yourself. So what does it mean for you? It's an interesting story so far, isn't it? But what do I actually do about this? Well, first of all, I said to you, the people who are gonna get hurt from this will be the beginners. The pros, the hedge fund, love is the Wall Street guys, they're making money out of this because they're running the show, right? But

Why US Debt Pulls America In

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the beginners, they don't know what the heck they're doing. That's why I'm gonna dedicate about two hours of my time this week to beginners and we do a live training with you. You can ask me questions. There'll be no knowledge assumed. It'll be purely, purely for beginners. So go to the fast trackforbeginners.com link down below and then show up for yourself. There'll be no replay, by the way. Don't bother asking for one. Um and I don't do that, by the way, because I'm mean. It's just I know people don't watch them. I've got the data. And I know you'll say you will watch it, but no, you won't, unless you're their life. Something in our psychology just doesn't allow us to pay attention for that period of time. And the truth is, if you don't have a plan for this, you're gonna do one of two things. You're gonna panic sell at the bottom, and then you're gonna freeze and do nothing while the skilled money scoops up all the bargains, which already has happened. And you're gonna lose. And if you're watching this thinking, I still don't even fully understand the basics, well, that's exactly what that beginner seminar I mentioned at the start is for. Fast track for beginners, right? This Saturday, completely free. So let me give you a bit of a framework here of what to actually do right now. Three steps. And you can start using that today. The beauty of this is it doesn't depend on you timing the market or predicting Japan's next move. It's about positioning yourself on the right side of a trend that's already started. So step number one is don't hold too much cash. As I said before, cash is an ice cube in very warm weather. Yes, you want to have an emergency fund. I'd normally say three to six months of expenses. Um, you know, don't empty everything out. But beyond that, cash is the thing that they quietly tax through inflation. Step two is own things that go up when paper money is under stress. I'm talking hard assets, good real estate. I'm putting gold into that list. Stocks with pricing power. Companies that can raise their prices without losing a single customer. Because when inflation hits, those companies don't get hurt. Sometimes they even benefit. And if you're wondering how to find those, go into the Winston app. You can track your own stocks, but you can also just click on stocks and just say, hey, I want the highest rated stocks only. But you can select which sector, you can select any US stocks or Canadian or European or, you know, whatever, uh German, God forbid.

What To Do With Your Money

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And then look at moat. Look at stocks with a with a with a near perfect moat, which are these 10 numbers here that I'm pointing at. And you can then go through that and you can look for some things that might be worth exploring, right? I'll put a link down below for this for you guys as well, so you have a free trial to this. And if you like it, you stick around. If you don't, you you know, you just cancel it and let me know. Uh, but it's a very, very cool piece of information that I look at all the time. So Visa, for example, I give you, give you, give you a feel, right? We give it a score of 75 out of 100. We tell you that score is actually improving, which is a good thing. We tell you who's buying it. You know, actually Trump just sold it, for example. That's kind of an interesting piece of information, perhaps, to have. Um, and it gives you all the insiders. Are they buying, are they selling, right? That's also an interesting piece of information to have and everything else. A ton of data. If you're someone who makes data-driven decisions, I think this is uh this is the place to be for good data. Uh so just check that out down below. And in terms of industries, I wouldn't buy the AI chip guys. I'd buy the guys who run the pipes, the exchanges, the custody firms, the payment processes, the infrastructure. Because there are firms out there that are going to make money no matter who wins the AI race, whether it's SpaceX or Anthropic or Google or whatever, right? So the pickaxe seller is usually better investment. And again, you can look up some of those ideas in the Winston up. But my golden rule ties this all together, really. If you can't explain what a company does and why it makes money to a 12-year-old, picture me, you probably shouldn't own it, right? Simplicity always wins, and that's really one of the first things I learned from my Wall Street mentors. It's just like, keep it simple. Whenever you have a really bright idea, just think this is really simple. And if it isn't, go and do something else. So let's bring it all together. We have one machine. The cheap yen is funded, has funded everything, your stocks included, for many, many years. The yen snapping back. So the giant hidden loan gets called in, Asia cracking first, Japan fired the biggest intervention ever, America broke a 30-year rule to help, and Wall Street got a $1 trillion 40-minute warning shot. None of this is a conspiracy. It's literally on the notepad of the Treasury Secretary. It's on the newswire, it's on the price charts. The question was never whether this is happening. The question is which side of it are you on? Which side of it are you going to be on? The people who understand this machine will earn the assets that rise when the paper money falls and fails. And the people who don't will hold the stuff that gets quite late in a life and they'll wonder why they keep falling behind, right? So if you're a beginner, join me on Saturday at fasttrackforbeginners.com, Saturday, 9 a.m. New York time. I think that's about 1 p.m. Uh Greenwich Mean Time. Although they no longer call it Greenwich Mean Time, right? They call it sort of universal whitewashed standard time or something. We'd never had an empire and stole everybody's wealth. No, no, no, don't remind us of that. Uh but anyway, um, grab that free um ticket, um, fasttrackforbeginners.com. Funny how we couldn't get that on one line, isn't it? Uh the delights of uh formatting. And if you got some value out of this, share it with a friend. That's really the only thing I ever ask of you is just share it with a friend. And I wish you a safe 2026.