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Does Japan Has A Demographic Problem

Demographics are a shorthand for all of Japan’s troubles. A declining labor force and an aging population seem like potent trends. But they are just excuses.

That’s according to Alexander Kinmont of Milestone Asset Management this week at a Heard on the Street Live event in Tokyo. “The reason the birthrate is low may be that nobody has got any money. It’s worth thinking about. Small houses, long commutes, no money. Is that an environment that’s conducive to a very fertile society? The problem to be resolved is money, not people.”

An attendee asked why companies like Honda continue to invest abroad, if demographics aren’t a problem? “The boardrooms of Japanese companies are filled with people whose careers are identified with the expansion of non-Japanese capacity, and they can’t turn around and say we were totally wrong, we misread the situation entirely…They dress it up as this waffle about demographics. It’s just a way of them saying, ‘We weren’t wrong.’”

Read the full story here. 


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