Castle founder Griffin: The sell-off of Japanese bonds is a clear warning to American politicians; he is optimistic about eased regulation.

On Wednesday, Ken Griffin, founder of Citadel, said the large-scale selloff in Japanese government bonds this week should serve as a “clear warning” to U.S. policymakers, urging them to improve the country’s fiscal condition.

During an interview at the Davos World Economic Forum, Griffin stated: “Bond vigilantes could appear at any moment and force the government to pay the price. What happened in Japan sends a very important message to the U.S. House and Senate: You must get the country’s finances in order.”

Japanese traders described Tuesday’s trading session as the most chaotic in years. Yields on Japan’s 30-year and 40-year government bonds both surged more than 25 basis points that day, marking the largest single-day fluctuation since last year’s global market turmoil triggered by President Trump’s ‘Liberation Day’ tariff policy.

However, Griffin also noted that the situations in the U.S. and Japan are not the same, and there may not be an urgent risk in the short term. He said: “The United States possesses such vast wealth that we can maintain the current scale of deficit spending for a period of time. But the longer we delay changing direction, the harsher and more punitive the cost of such a shift will be in the future.”

In this wide-ranging interview, Griffin expressed optimism about Trump’s deregulatory agenda. He also spoke highly of some other initiatives being pushed by the Trump administration, including issues at the southern border of the U.S., but emphasized that he is a strong supporter of rational, prudent immigration policy. Griffin noted that many senior executives at Citadel and Citadel Securities come from all over the world.

On housing policy, Griffin’s position differs slightly from the president’s. He stated that the real problem in the U.S. real estate market lies in undersupply and excessive regulation.

Griffin added that it would be a mistake for American business executives not to speak out on Trump’s policies. “They really shouldn’t be afraid to express their own views. He sometimes teases and provokes others—there are indeed such moments—but he does listen.”

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