An article in Monday’s Wall Street Journal (here; it’s mostly behind a paywall, but you can watch the video) talked about the plight of millennials in Japan these days. They never experienced the high-flying years of the 1980s when it looked like Japan would dominate us for generations. Instead, they’ve known a stagnant economy with few jobs, deflation rather than inflation, and low interest rates that have sometimes gone negative. They often can’t get hired by companies because those companies have older workers who can’t be fired. And even those younger people who do have jobs don’t get raises, so they believe there is no point in devoting themselves to their careers. Because of the deflation, they know that anything they buy may be cheaper tomorrow, so why buy it now? Accordingly, they’ve come to value experiences (like travel) rather than things.
The article talked about one young Japanese woman who “shops” by raiding her mother’s closet. They mentioned a Japanese man with a business idea who could not get a loan for the amount he wanted because, despite low interest rates, banks are reluctant to lend without a lot of collateral. After his business proved successful, he wanted a loan to expand, but couldn’t get one. And it’s not because the banks don’t have a lot of money because they have plenty; young people there have nothing else to do with their money except bank it, despite the low interest rates. So, some (banks and companies) have lots of cash, but they do nothing with it. Others have little except what they can save, and even then they may have to spend their money taking care of their elderly parents.
To a lesser extent, young people here are feeling the same pressures. My niece talks about how she prefers experiences to things. Here, however, lots of young people are in debt, which doesn’t seem to be true of Japanese millennials. And there are some jobs that allow for advancement and raises.
Anyway, the article says that Japanese leadership is out of ideas. They’ve tried pushing interest rates down to zero. They tried big cash infusions into the economy, so much so that some critics worried about hyperinflation. It did nothing to dent the deflation. Two suggestions: (1) Why not raise interest rates? Banks seem to have all this cash which they don’t want to lend out, but maybe they could be coerced into giving their customers higher interest rates. If ordinary people have more money, they may spend more. (2) What is being done to create jobs? Nothing, it seems. Banks don’t want to loan money, and the cash infusions I’m sure did not go to entrepreneurs but rather to banks or similar entities, which are doing nothing with it. The article did not specifically talk about any job-creating efforts, and they only talked about one entrepreneur, whose basic problem was not being able to get the loans he wanted. It’s likely that a lot more could be done to help entrepreneurs than is being done now, but it all sounds very depressing.
But one thing that intrigues me is that if Japanese millennials don’t value things as much as experiences, then antiques and ultimately art in Japan are going to decline in value as this generation gets older. Outsiders who still do value their art are likely to swoop in and grab some bargains, with Hiroshiges and Hokusais flying off the shelves of Japanese art dealers. And then a century from now the Japanese will talk about how we “stole” their art heritage.