Kung Hei Fat Choi / 恭喜發財! At Year of Dragon, my year!
Lost and found in lost 30 years of Japan? Wishing for prosperity? Confidence.
Coaching from Sub-Zero for Survival in the Real World / Session 2, 2024
“Hiro, will be in Tokyo during Chinese New Year?” This classic email rings my bell to set classic my routine with my best VIP friend call from Hong Kong. Well-expected call as enjoying nearly every high-level WhatsApp chat, but I feel that this time should be a great milestone for me, after seeing his family,, since 2002. To wrap up Tokyo and Japan’s whole topics should be a priceless exercise to reveal a real Japan with inter-subjectivity.
During the site visits in Tokyo and business meetings during Chinese New Year, my thesis on Japan’s strategy and fact findings have not been changed but rather cemented my opinion has been right. We see strange economics as I mentioned before (https://readmedium.com/in-tokyo-you-can-enjoy-both-coffee-at-75-cents-and-condo-at-us-8-200-psf-60a5a515371f) and the strategy to this should not be changed (https://readmedium.com/kona-wind-winter-2024-part-2-e171764dbb99). Moreover, the only limited number of Japanese enjoy this booming stock market and property market boom now.
Interestingly we see the Nikkei Stock index overtook the peak of 1989 this year, but it seems most of the buyers are from outside of Japan and most Japanese investors keep buying ETF or the US market. This illustrates the major difference between now and the late 1980s and early 1990s in Japan. At that time, Only Japan was booming (despite US and Europe being under the water and still China was not in the center field of the world economy), and the Japanese bought Japanese stocks and properties while still population was increasing. Now only limited Japanese living around here enjoy the benefits and wages have not been increased as much as we saw in late 1980s. Bipolarization? Not much as that of the US, but this trend gradually came to Japan, even though we do not hate Trump yet. Still keeping socialist system and surviving as 中庸, Phronesis or golden meaning method, which I believe the next great thesis at geographical issues. Divided is not the solution.
During the site visits of high-priced condos and hotels in central Tokyo (only at limited area), we always discuss how we learn from the lost 30 years and how China and the other countries learn from this. I usually use 陰陽, Yin, and Yang metaphors at this discussion. (https://iep.utm.edu/yinyang/)
>> As seen in the long-term chart, Japan’s wages have not increased and only capital outflow has benefited from surviving Japanese corporates.
>> Japan’s government system is still with the ancient regime.
>> Japan’s GDP has been overtaken by China and Germany for now.
>> Despite the zero interest rate policy, Japan’s private asset size at company balance sheet have been doubled from 1992 to now and more than half have kept at bank deposits. This patriot deposits help most of public debt re-financed domestically and no worry on public insolvency like South Korea faced in year 1997.
>> After Plaza Accord in 1985, Japanese Yen surged from Yen 360 to USD to 100 or 150 Yen level, but we have now many international hotel brands (Four Seasons, Hyatt etc) and huge inbound traffic support domestic economy.
>> We did not have Shohei Otani (LA Dodgers at MLB), Naomi Osaka in Tennis, Hideki Matsuyama at PGA Golf and Rui Hachimura at LA Lakers of NBA, 30 years ago, Young Turk are flying into the global market.
<We should learn more about our failure in 1995 to 1996>
As I discussed before we had a milestone in the year 1997 and lost much trust in the business system, especially banking (https://readmedium.com/lesson-from-the-crisis-the-year-of-1997-fa56f9745903). But the more we examined, the more we learned what were happened in years 1995 and 1996. Amazingly most of the Japanese including the central government turned to be positive to overtake the bubble economy and huge subsidies took over the image of a positive image of the economy for two years. This makes long term interest rate kept relatively high and made consumption tax increase. Later?? The sudden clash caused many major banks to be bankrupted and entered into turmoil in 1997 and 1998 (the Asian currency crisis in 1997 did not make a direct impact to these domestic issues). Under-estimation of the bubble economy’s impact in Japan was made clear in 1997. I am sure now is the right time to look over how we made a mistake in this “underestimation” in 1995–1996.
Anyway, This year of Dragon. I commented that this year was my year of Dragon (60!) and said “OK, You are the same of Li Ka Shing, a man of dragon?!” This was the best tip for me during my great experience in CNY in Tokyo. Dragon,,, a year of great prosperity and change.
