TOKYO, June 12, 2020—The Japanese stock market, which shone as the gold pavilion of the world in the 1980s, totally lost its luster. Even Toyota Motor, Panasonic and Honda Motor whose products once were envy of global consumers have been lackluster on the Tokyo Stock Exchange over the past several years. What it means is that Japan is finished as a post-WWII economic miracle and set to go into deep oblivion of other countries. The country would become an East Asian resort destination for Asian neighbors for its abundance of natural resources, and if its socioeconomic conditions become desperate, a Chinese province.
I have come to this conclusion by randomly analyzing historical stock price charts of leading Japanese companies, the likes of the three well-known companies but also of decades-old ones in industrial sectors and late-comers in consumer industries like Uniqlo.After hitting a record high of 8,783 yen in March 2015, Toyota has been fluctuating around the 7,000-yen level the past five years for most of the intervening period. That’s even with its massive stock buy-back over several times during the period. The pattern is more or less the same for Panasonic and Honda. And lesser known companies’ performances are more miserable: Nippon Steel, which once boasted as the world’s largest and best steel maker, was as high as 3,590 yen in September 2013. It’s now 1,016 yen.
Of course, there are companies whose stocks are rising, the likes of low-priced apparel maker Uniqlo and low-priced furniture retailer Nitori. But they do not come from the traditional and contemporary manufacturing sectors such as autos, electronics, and bio and robotics; they thrive on business models and designs that had been unbeknown to the Japanese until their stores opened in Japan. There are also-run and look-alike biopharma manufacturers and startups dabbling in robotics but not of the levels you find in the United States or Europe.
Based on my random analysis, and if the stock market is an indicator of developments to come in three years or afterwards, Japanese society is not looking promising. Rather, it’s looking gloomier than before, particularly after the coronavirus pandemic swept the world this winter.
So it was no surprising to hear long-time stock investor friends and economists say that the Japanese stock market – and the economy too – is in the midst of a slow death.
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Insight Into the Future