While it hasn’t been openly discussed, I strongly believe a central but hidden objective of these trade agreements is to intentionally push the US dollar lower relative to other major fiat currencies. One possible lever to support that effort could be Japan allowing its long-term interest rates to rise relative to US yields. Keep in mind, only about one-tenth of Japan’s debt is tied to maturities of 20 years or longer. It also wouldn’t surprise me if a large portion of the $550 billion capital commitment Japan recently announced — without specifying a timeline — ultimately comes in the form of Treasury purchases, helping to drive US yields lower. Although already the largest holder, Japan’s Treasury holdings have remained virtually unchanged for over a decade. For the record, I don’t believe this is just about Japan or the yen. Even after its worst year-to-date performance since the 1970s, the US dollar remains significantly overvalued by historical standards — and a meaningful decline is likely a necessary adjustment to help correct the severe trade imbalance the US currently faces.