In recent months, the mainstream media commentators have been issuing increasing lurid predictions of how the ‘out of control’ fiscal situation in Japan is killing the yen and a full-scale currency crisis was imminent, after the yen moved across the ‘fabled’ 160 mark against the US dollar. What is ‘fabled’ about that threshold is anyone’s guess, but mainstream economists and their mouthpieces in the press love to come up with disaster thresholds that generate headlines. There is nothing significant about 160. Last Tuesday (September 1, 2026), the yen reached 160.20. At the time of writing, the yen was sitting on 155.95 to the US dollar. Why is the yen appreciating again? And why have the short-sellers become very wary? Especially, as the Takaichi government is clearly intent on pushing ahead with the rather significant fiscal expansion, which the mainstream think will kill the currency. This post argues that the yen dynamics have little really to do with fiscal policy settings. Other factors are more significant and often reflect the skittishness of the financial markets chasing profit wherever they can find it. The commentators and the financial market spokespersons might claim the dynamics are all about excessive government debt and all that political stuff, but the reality is very different. As you were!