Treasury Secretary Scott Bessent fired back at Sen. Elizabeth Warren, D-Mass., in a sharply worded letter responding to her criticism of the Trump administration’s intervention to support the Japanese yen, accusing the senator of misunderstanding basic foreign-exchange markets, as reported by the New York Post.

Bessent’s Thursday letter came after Warren, the ranking Democrat on the Senate Banking Committee, sent an Aug. 13 letter demanding details about the Treasury Department’s use of the Exchange Stabilization Fund, or ESF, as the United States joined Japan in buying yen after the currency fell to a roughly 40-year low against the dollar.

The Massachusetts senator raised concerns that American taxpayers could ultimately face losses if Japan failed to repay the Treasury.

Bessent rejected that premise, arguing that no loan had been made and that Japan owed the United States nothing.

In her latest sciolistic letter to me, @SenWarren made it clear that she knows even less about foreign exchange markets than she does about banking.

What is equally shocking, but not surprising: not a single member of the media mob has a rudimentary-enough level of financial… pic.twitter.com/0mmp2tapqJ — Treasury Secretary Scott Bessent (@SecScottBessent) August 28, 2026

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“The lefty Massachusetts senator’s recent attack ‘unfortunately reveals that you know even less about foreign exchange markets than you do about banking,’” Bessent wrote.

“Terrifyingly, the opening paragraph is wrong about where the money came [from], what the transaction was, and whether there was even a borrower.”

Bessent said Treasury had exchanged existing Exchange Stabilization Fund foreign-currency assets for yen rather than extending credit to Japan.

“Treasury exchanged existing Exchange Stabilization Fund foreign-currency assets for yen,” he wrote.

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“No new congressional appropriation was involved, and no credit was extended to Japan. Japan owes Treasury nothing.”

“There is therefore no risk that Japan will fail to repay a debt that does not exist.”

The Treasury secretary also took aim at media coverage of Warren’s claims, writing, “What is equally shocking, but not surprising: not a single member of your media mob has a rudimentary-enough level of financial market literacy to spot your remedial error.”

The intervention marked the first coordinated effort by the United States and Japan to strengthen the yen since 1998.

Treasury, acting through the New York Federal Reserve, sold euros and bought yen, although the exact size of the U.S. purchase has not been publicly disclosed.

A Reuters photograph taken July 31 showed a notepad in front of Bessent containing the words: “To Do Buy Japanese Yen (JPY) $5-10 bil.”

The note appeared to show a possible purchase in that range but did not establish the amount ultimately purchased.

Warren also questioned Treasury’s legal authority to use the ESF.

Bessent responded by pointing to Section 5302, which he said authorizes the Treasury secretary, with presidential approval, to deal in foreign exchange in support of orderly exchange arrangements.

“Your legal question is answered by the statute cited in your own footnote,” Bessent wrote.

“Treasury’s legal analysis begins with reading the statute. I recommend you try the same.”

Bessent defended the intervention as being in the United States’ economic interest, citing Japan’s position as a major holder of U.S. Treasuries, a significant trading partner and a treaty ally.

“Disorderly yen markets can trigger forced unwinds, which could destabilize global markets and ultimately raise borrowing costs for American families and businesses,” he wrote.

Then came Bessent’s most pointed suggestion for Warren and her staff.

“For a fuller explanation, I recommend any entry-level course in international finance for you and your staff, or I can give you a tutorial on Foreign Exchange for Dummies.”

Japan spent a record $96.5 billion intervening in foreign-exchange markets between July 30 and Aug. 26, according to government data released Friday.

Treasury has not disclosed the amount of its own yen purchase. The yen initially rose after the intervention before giving back much of those gains later in August.

Warren also cited Treasury’s previous use of the ESF to provide $20 billion in support to Argentina, calling that action politically driven.

Bessent defended the operation as an effort to address “acute, short-term illiquidity” and prevent a broader regional crisis.

“The best-managed crisis is the one that never happens,” he wrote.

“You, by contrast, appear to view preventable crises not as failures to avert but as welcome opportunities to expand government control — with ordinary Americans paying the price.”

Bessent concluded with another criticism of Warren’s approach to congressional oversight.

“The American people deserve oversight grounded in facts rather than slogans,” he wrote.

“Although I am not holding my breath, I hope your next letter will demonstrate that you have learned the difference between a currency purchase and a swap or a loan.”

A spokeswoman for the Senate Banking Committee said Warren’s questions remain unanswered and accused Bessent of focusing on the wrong priorities.

He “should focus less on his petty grievances with Senator Warren and more on reducing the cost of living for the American families struggling in President Trump’s economy,” Senate Banking Committee spokeswoman Saloni Sharma said in a statement.

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