Why Your Future is More Japanese Than You Think: Three Tokyo Trends to Watch!

Screen Shot 2013-05-27 at 14.32.28For anyone who was socialised in the developed world during the 1980s, 1990s and maybe even 2000s, Japan was arguably synonymous with one thing above all: technological magnificence, much of it in the service of futurism. As a whole, the West only managed to take industrial development to a certain point and no further: more than anyone else, it was the Japanese that transformed the world of nineteenth century-style factories churning out clunky analogue products into a universe of cute, smart electronics manufactured by R&D intensive laboratory-plants. Japanese ingenuity represented Advancement.

Yet in recent years, Japan seems to be pioneering a new form of whatever is to come for humanity – and it doesn’t look as sexy. Indeed, examining the various macro-trends within the Japanese economy and society as a whole – trajectories almost certain to be followed by much of the rest of the planet – the Brave New World being sketched out by this particular member of the G3 are enough to give us all pause for thought:

1. Bubble Mania. Way before anyone had coined the phrase ‘credit crunch’, the Japanese had produced a world-class real estate bubble, with select properties in the pricier areas of Tokyo reaching a stunning ¥30m/US$215,000 per square metre. The consequences were predictable: the asset bubble was pricked; the Japanese government bailed out horribly exposed financial institutions instead of letting them go to the wall; property prices collapsed anyway; and conventional economic growth has been unheard of in the country ever since. This did not stop the United States (and to a lesser but still vast degree, Europe) from copying this particular Japanese model.

2. Nuke Me Slowly. This is a caption from an ironic t-shirt that our CSO spotted being sported by a Yoshi’s Island player in London during the mid-1990s; however, the Japanese seem to have taken this exhortation all too literally, with the construction of nuclear power plants on earthquake fault lines yielding nation-defining results at Fukushima. This has not stopped other quake-prone nations – India, China and Iran amongst them – from opening nuclear power plants in catastrophe-guaranteeing locations.

3. File>Print x ∞. Confronted with a two-decade economic slump and reeling investor confidence, Japanese Prime Minister Shinzō Abe has responded in the manner required for testing times: ordering the Bank of Japan to print the bejesus out of what is left of the yen. This strategy – such as it is – may have the benefits of engendering a temporary stock market spike and giving a little bit of breathing space to vastly overstretched and uncompetitive Japanese exporters; it will also bring Japan to new economic lows while not solving any of its structural problems. Naturally, both local and global audiences – from idol group Machikado Keiki Japan to über-economist Joseph Stiglitz – are begging for more.

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2 Comments

Filed under Economics, Finance, Political Science

2 responses to “Why Your Future is More Japanese Than You Think: Three Tokyo Trends to Watch!

  1. Well said. You make astute observations.
    Let’s hope Japan can pick itself up from its stasis, as not only Japan itself but the global economy desperately needs it (but, as you point out, printing money to artificially inflate the economy is not the way to go, as we learned with the Weimar Republic).

    • Perhaps the saddest thing is about Abenomics is that it is yet another extreme measure that does nothing to address Japan’s structural problems. The issues of demographics, energy, public debt and corporate restructuring are being treated as if they didn’t exist.

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