TAG Industrial Watch: May 23, 2026

In the latest issue of the Industrial Watch magazine, completed during the outbreak of the war in the Middle East, TAG anticipated that America’s actions would result in more foreign sales of U.S. Treasuries. The release of the Treasury Department’s report on foreign Treasury holdings did indeed reveal a massive drawdown of -$138.4 billion during the first month of the war in March, marking the biggest monthly decline since the historic foreign sell-off in 2023. Notably, foreign governments and central banks accounted for 79% of the reduction. Total selling (private and public) was led by Japan with holdings down -$47.7 billion, followed by China’s -$41.0 billion decrease. While China’s selling supports the nation’s existing plan to “de-dollarize” its economy, Japan remains a strong ally to the U.S. Nonetheless, Japan, which is the biggest foreign lender to the U.S. government with $1.2 trillion in Treasuries, is no exception to self-preservation.

Japan’s oil consumption relies entirely on imports and has been hit hard by the global oil shortage. Compounding this problem is a historic rise in Japanese interest rates thanks to their massive accumulation of debt. Consequently, the Japanese yen is on life support as the dollar exchange rate sits near record lows. However, Japan’s problems can and likely are being addressed by selling U.S. Treasuries, allowing the nation to load up on American oil (boosting U.S. exports), buy back its own currency to support the value of the yen, and retire debt. Given that the last foreign-driven surge in interest rates in 2023 caused a 37% drop in U.S. industrial sales, investors considering an exit strategy should take this as a sign.

I N D U S T R I A L N E W S

Japan, China Lead Foreign Government Retreat From U.S.
Treasurys As Iran War Fallout Stokes Currency Fears
CNBC – May 19, 2026
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US Oil Exports Hit Record High.
What Does This Mean For Gas Prices?
USA Today – May 6, 2026
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US Crude Oil, Gasoline Inventories Continue
To Crash As Iran War Takes Its Toll
OilPrice.com – May 13, 2026
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Russia’s Oil Revenues Surge $6.3 Billion
As High Prices Offset Production Losses
OilPrice.com – May 13, 2026
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Record Oil Draw From US Emergency Reserve
Drives Total Volumes To Two-Year Low
Reuters – May 18, 2026
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R E G I O N A L N E W S

Chicago’s Industrial Market: A Calmer Sector
After So Many Boom Years?
REjournals – May 12, 2026
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Havener Cos. Secures 93 KSF Fort Worth Industrial Lease
Commercial Property Executive – May 4, 2026
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More Than 5,100 Freight-Related Layoffs
Hit US Supply Chain Sector
Freightwaves – May 18, 2026
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Census: As North Texas’ Far-Flung Towns Grow,
Dallas And Its Bigger Suburbs Shrink
The Texas Tribune – May 14, 2026
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Phillips 66 To Expand Gas Processing
In Permian Basin And Gulf Coast
Reuters – May 18, 2026
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