Tres Knippa: Japan Is In Very Big Trouble – 9/25/13
Tres believes that Japan is in very big trouble. He says that the biggest problem facing Japan is that one-half of all the tax revenue that comes in to the Japanese government goes to paying interest on their outstanding debt! If you get a 1% move in rates, that is it, Japan is bankrupt, its all over.
According to Tres, the Japanese are doing the same thing that we are doing here in the United States; they are just doing it incrementally bigger. This debt is not going to be paid back.
So why hasn’t the bond market imploded yet? Tres says that the artificial demand from the Bank Of Japan buying up 75% of all new bond issues is holding the market together.
When the existing owners of these bonds turn into sellers, Tres says the Bank of Japan will not be able to print fast enough…
Tres Knippa holds a seat on the floor of the CME Group and is an expert in options trading. Tres is a regular guest on CNBC, Bloomberg, and Fox Business News. Tres is the founder and owner of Kenai Capital and ShortJapanDebt.com.