Trump Accidentally Just Revealed The US Dollar Is In Big Trouble

New column by Lee Camp

Column and voice-over by Lee Camp

The US just did something it hasn’t done since 1998 — bought somewhere between $5 and $10 billion worth of yen in order to prop up the Japanese currency. …But Trump and Bessent don’t want us to know it wasn’t really about the yen. It was about the US dollar.

The Trump administration claims they executed the trade simply “as a signal of friendship.” You know Trump — he just loves helping people. He especially loves helping people when it involves spending billions of dollars. (Love and friendship meant a little less to him a few months ago when he missed his son’s wedding in order to focus on murdering schoolgirls in Iran. Gotta have priorities.)

But this wasn’t about friendship or helping an ally. The US Treasury is trying to prop up the depreciating Japanese currency in order to protect the US dollar system from a growing crisis.

As Ben Norton pointed out:

“Japan provides [a] crucial service for the US empire: it acts as the largest foreign holder of Treasury securities (ie, US bonds, US government debt). In other words, Japan lends more money to the US than any other country.”

That’s right. Japan scoops up more US debt than all other countries, even China.

“As of February 2026, Japan owned about $1.24 trillion ($1,239,300,000,000) in Treasuries.”

China now owns only $700 billion worth as it dedollarizes more every year.

But Trump’s unhinged war on Iran has not been kind to Japan. It has heavily impacted Japan’s energy markets and its currency. Japan’s government responded by selling over $100 billion of US Treasuries.

To sum that up: The largest holder of US debt has been getting rid of its holdings of US debt.

And it’s not just Japan. Many other countries have been dumping the US dollar. Ben Norton notes,

“The problem is that foreign governments are less and less interested in holding US Treasuries — precisely at the moment when Treasury issuance is exploding, because US debt is rising so quickly… The share of Treasuries held by foreigners has hovered around 32-33% since the Covid-19 pandemic. This is a stark decline from more than 45% in the early 2010s.”

There are several reasons countries are dumping the dollar, but one of the bigger ones is the choice by Washington to straight-up steal other countries’ assets when they can. They pilfered $4.6 billion belonging to Venezuela, and even though it was gold and not dollars, it still shows the US/EU will pillage and rob any assets they want.

The US/EU also swiped $300 billion worth of Russian assets in 2022 to try to teach Russia a lesson. Instead, they taught the whole world a lesson: Don’t keep your assets anywhere within the reach of the US/EU’s greasy tentacles. One way to do that would be to avoid US Treasuries.

So with foreign governments dumping the dollar, the US rulers needed something to make up the difference. They turned to foreign private investors — billionaires and hedge funds. Back to Norton:

“Like Japan, these private firms are also holding up the global dollar system. This is why Adam Tooze has argued the arrangement should be called the ‘hedge fund dollar’, or the ‘billionaire dollar’. The petrodollar still remains a significant pillar of the global dollar system, but the hedge fund dollar has become even more important in recent decades…”

So we now have the world’s richest people propping up the currency of the world’s (ostensibly) richest country because if they don’t, they won’t be rich much longer.

And here’s the kicker: Trump and Bessent’s efforts to save the yen, thereby helping the dollar, didn’t even work. The yen is worth even less now than it was at the beginning of August, just before the US Treasury swooped in and bought billions of them.

You add all of this up and what do you get? A giant flashing signal that the dollar-based financial system is in crisis.

How low can the US dollar’s share of global reserves fall before the $40 trillion US debt starts to have major ramifications? …Eh, who cares?? Let’s just keep partying like it’s 1999!