The Japanese bond market may be the most easily underestimated risk point in the global market right now.

The 10-year government bond yield has surged to a 30-year high, the 30-year government bond yield once hit an all-time high, and the yen remains near a 40-year low.

Bond pressure, exchange rate pressure, and central bank buying retreat happening simultaneously in one country — the risk will spread outward along the capital chain.

These signals together:

Japan's 10-year government bond yield rose to 2.87%, a 30-year high.

Japan's 30-year government bond yield once surged to 4.2% this year, an all-time high.

The yen is still near 162 against the dollar, close to a 40-year low.

Japan's foreign exchange reserves are approximately $1.31 trillion.

The Japanese government plans to promote about ¥370 trillion in public and private investment by 2040.

The Bank of Japan plans to reduce monthly bond purchases to about ¥2.1 trillion by early 2027.

Private banks prefer short-duration assets, making it difficult to fully absorb long-term bond supply.

Japan will have to spend more money.