Bloomberg reports on the potential for baby boomers’ kids in Japan going into property for the first time, which could be an engine of economic growth as well, given the market share of the 35-44 age group.
Nevertheless, it seems like yet another echo of positive government spending, and attempts by the country to claw itself back from a balance sheet recession. Household spending +government spending + increased overseas sales from a weak(ening) currency + corporate overseas expansion = lending growth? What are the multiplier effects on each of the component terms and the magnitude of the initial sums? interesting things to note!
Yes, the 1987 housing starts examplemight not be the absolutely best example of a sustained push into housing, but interesting to note nonetheless. The baby boomers of this 35-44 group make up twice the demographic clout that their parents did? There might just be more to this data than meets the eye!
One question: What happens if most Japanese people have a house that for the first time in living memory is appreciating in value? How much will this feed through in terms of other purchasing power and consumer confidence? Might this spur some further lending and less stigma in either spending, borrowing, or higher yield investing?
Should the balance sheet recession be truly over, and there is a stronger rebound from the earthquake (which I do superficially believe will be the case given my forecast yen trajectory and corporate cost management innovations in this expensive-energy era) and unemployment ticks lower, one would expect further factors to line up behind the “all clear”.
Brace yourself, one quote you rarely hear, courtesy of Jesper Koll via Bloomberg:
“Japan is in a demographic sweet spot”