Gold just posted its worst quarter in 13 years, snapping a blistering run that stretched through 2025 and early 2026. Equities are poised to open the second half on the back foot. The shift recalls an earlier era of financial anxiety, one Michael Lewis captured in a 1989 piece of speculative fiction titled "How a Tokyo Earthquake Could Devastate Wall Street."

Lewis imagined Japanese savings rushing home to rebuild after a seismic catastrophe, triggering a Wall Street meltdown. At the time, Japan commanded the world's dominant stock market and economy; U.S. markets leaned heavily on that capital. Today the script has flipped. All 10 of the world's most valuable public companies are U.S. tech firms, and Japan barely registers on American investors' worry list.

That complacency may be misplaced. A mere market tremor in Japan two years ago sent U.S. tech stocks tumbling and drove the VIX fear gauge to its highest level since the Covid emergency. The episode revealed how tightly correlated the two markets have become, even as Japan's economic weight has faded.

The lesson is straightforward: capital flows still transmit shocks across borders faster than most models assume. Ignoring Japan because its GDP share has shrunk misses the plumbing that connects Tokyo's margin calls to Nasdaq's biggest names.