Yen Carry Trade Unwinds, Triggers Global Market Chaos

The yen carry trade is unwinding at an alarming rate as Japan's rising interest rates threaten to trigger a global market crash.

Investors have been borrowing yen at virtually zero cost and investing in assets worldwide, but with Japanese interest rates increasing, the equation has changed. Now, borrowers must accumulate dollars, convert them to yen, and repay their original loans.

This process is equivalent to 'economic nuclear war' according to Jim Rickards, an eight-time best-selling author on financial and market topics.

If banks stop lending, investors will have to liquidate positions in international markets to raise liquidity, putting stocks, bonds, commodities, real estate, and cryptocurrencies under pressure.