the difference is that debt of japan is owned by the japanese while US debt is substantially foreign owned.
JGBs starting to err towards complacency again. Insure 1MM notional ATM for $3500 for 10 days (and that includes through this Fed meeting!)... (vol is around 4.1%) Before all of this recent market turbulence, vols were at 2.5%... (oh how I dream of 2.5% again. front puts were ~$2k/mo 1% OTM -- or 250bp/yr) Is that enough convexity Mr. Bass? I'm sure he's buying some strip equivalent of 2-3% OTM to get to ~100-150bp/yr. (and of course, probably playing longer end than 7yr)
Soros has already gone into some of this. http://business.financialpost.com/2...ing-a-yen-avalanche-it-cant-stop-soros-warns/ I know the BOJ was starting to catch flack due to the steep increase in the cost of materials many manufacturers were seeing.
And now China is getting into troubles⦠http://www.zerohedge.com/news/2013-06-19/china-interbank-market-freezes-overnight-repo-explodes-25
What a great effort for Japan to control the interest rates in the current rise of the cost of money.
The bearish movement of UsdJpy has developed into 5 waves. The current one is a correction that is not going to last over 99.30. Stay bearish, target 90.