Japan is the world’s second-largest economy. It is also America’s second-most-important creditor. The U.S. government owes Japan over $724 billion! The only nation America owes more money to is China ($800 billion). The U.S. also imports $140 billion worth of goods from Japan each year.

If Japan were to follow through with its threat to only lend in yen, the dollar would probably fall hard. What would that mean? America gets more expensive consumer goods, higher unemployment, and currency inflation. If other nations like China follow suit, we would be looking at a currency crisis—Zimbabwe-style. America’s ship of state is sinking. Japan’s lifeboat has already left.