Japan

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Sometimes we all need to change the window we look out of to forget politics, work, relationships or finances. Bathe your feet in hot water while you dine. Find your place of peace. This is 東府や(Toofuya) in the Izu Peninsula. 静岡県伊豆市吉奈98 Bakery & Table

#MakeShimaneGreatAgain

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In CM’s Make Japan Great Again report we noted that Shimane Prefecture has had the slowest population growth in almost 100 years. Shimane has seen its population fall 3% since that time. The issue is not just that Japan has a declining population rate, the regions are depopulating at too fast a pace. Without wanting to get too technical Shimane Prefecture is hosting a drive to get people to move there as it provides great childcare facilities and jobs! Half the battle of such drives, as well intentioned as they are, is who jumps first. While available daycare slots in the big smoke of Tokyo are hard to find, the population is still growing giving much better optionality for the long term.

I will be attending the seminar as I’m curious what other bait will be offered. Indeed Shimane, as lovely as it is to visit,  one wonders what excitement awaits with a population in decline. I was there in September – as was the last time I visited – there is nothing to speak of worth setting up a new life. At least Shimane is facing up to its reality and for that they deserve the full accolades of trying to resuscitate a region that is the same as it was 100 years ago.

Terrorism in Japan

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Can anyone recognize the person in this picture?

 Most foreigners won’t know her. Her name is Fusako Shigenobu. She looks harmless and sweet enough. The girl next door? She is actually the Japanese equivalent of Ulrike Meinhof. Shigenobu founded the Japanese Red Army (JRA) in 1971 at the tender age of 26. The JRA was responsible for a spate of hijackings, hostage takings, airport massacres and bombings in the 1970s and 1980s. It was closely aligned to the Popular Front for the Liberation of Palestine (PFLP). Although she claimed the group disbanded in 2011 it has since been renamed the Movement Rentai. Many are not aware another Japanese terrorist organisation bombed Mitsubishi Heavy Industries HQ in 1974. Aum Shinrikyo is perhaps the freshest in many memories for the 1995 sarin gas attacks on Tokyo’s subway. Japan is a safe country to be sure but that does not mean it is immune to future attacks.

CM – Terrorism in Japan

Sadly Japan is suckling on the bosom of (a false sense) of security. The above link contains CM’s full study.

Crime in Japan – Geriatric Jailbirds

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CM – Crime in Japan – Geriatric Jailbirds

I have been asked by several people to rehash a report I wrote on elderly crime in Japan back in Feb 2016. The above link contains the entire report. Below is a brief summary.

While retirement for many of us is some way into the future, common sense would dictate that once we reach it, committing crime is probably furthest from our minds. Hugging one’s grandchildren is surely a better option than talking to them through a glass window. If you are in prison you are supposed to be old when you leave not when you enter it. Not so in Japan.

The incidence of crime committed by the elderly is soaring. 35% of all arrests for shop-lifting involve the retiree demographic, up from 20% (2001). Since 2001, their representative percentage of the prison population has doubled and 40% of repeat offenders among the elderly have committed crimes six times or more in order to return as a guest of His Excellency. While much of it is petty crime, there seems a deliberate attempt to ‘break into prison’ as a way to survive. A roof over their head, three square meals a day, no utility bills and unlimited free health care. The only real negative being the harsh prison rules about when one can talk to fellow inmates. To the state, one inmate costs ¥3.8mn to incarcerate and we estimate around ¥300,000 in court and administration fees per incarceration. Furthermore supplemental healthcare to the prison system has doubled in the last 7 years. We study the economics of what might drive someone to make the choice to commit crime and look at the government’s current funding for income support. Is it being spent wisely?

Such has been the overpopulation in prisons, the government has had to increase capacity by 50% in the last decade and boost the incidence of early release and parole to create space for what one can only guess is a way of developing state sponsored retirement villages. Female prisons are already full but the MoJ wants to increase the number of female prison guards to prepare for the anticipated increase in elderly crime.

At the last (average) count in 2010, there were 4,069 elderly inmates. While that is only 14 people per 100,000 aged over 65 that rate has been climbing from 12 in 2004 and around 8 in 2000. We estimate at the 5.4% compound growth rates experienced to date, that 31 people per 100,000 is possible by 2036. At that rate, 11,636 elderly citizens would be in jail at a cost to the government of ¥42bn per annum as health cost related budgets have been appropriated at around ¥120,000 per elderly inmate.

‘Supplemental welfare’ or income support paid by the Japanese government is approximately ¥3.6 trillion per annum and spread across 5.9mn people (an average of ¥605,000 per person). ¥1.7 trillion of that total is for medical and nursing care (c.¥1.2mn per person). Note this portion of healthcare is separate from the ¥36 trillion annual healthcare budget.

What are the economic sums that drive a pensioner to consider committing crime? We surmise that a measly base pension of ¥780,000 (US$7,000) per annum won’t get one very far. When throwing on top of that healthcare, rent, utilities and food it is not hard to get someone into net-negative income territory. Sure, supplemental income through part time work may close the gap but perhaps that some are resigned to their fate to consider jail as an option.

There is another elephant in the room. Suicides among pensioners are now 40% of the total, up from 27% in 1983. One gets the feeling that all of the things that retirees had come to expect from a society is in reality against their long-entrenched cultural thinking. Wives of retirees now make up 6% of all reported suicides. They are obviously not adjusting to having the bread winner at home every day. We break down suicides by prefecture and show the clear link to elderly populations, low population growth and relatively smaller GDP compared to national averages. The economic malaise in the regions contradicts a vibrant Tokyo and much of what is going on does not get reported. Domestic violence committed by the elderly has surged 2.4x in the last 5 years. The number of murders committed are even higher.

Solutions are hard to fathom. By 2060, 40% of the population will be above 65 years of age. Would Japan be better off building large scale dormitories that would include medical facilities in return for pension sacrifice? This way these pensioners could trade off prison life for state sponsored shelters at one would expect a fraction of the cost of adding to prison population. Surely if the government met potential pickpocketing pensioners half way then it would be preferable to both parties on cost and shame grounds. Would a Benesse (9783) be interested in running a public-private initiative (PPI) to help the government build such centres given they are already investing in old age care facilities? Benesse wants to expand its elderly care business to 20% of the group total by 2020. The government has taken this approach of PPI with building day-care centres as JP Holdings (2749) has benefitted greatly from. The government needs to think of how to revitalise the regional areas. With slowing economic growth, working age employees flock to the cities where jobs are more likely. It exacerbates the pressure on the regions to survive and poses longer term risks for the companies in the region to sustain employment. PPI projects in the regions makes sense from a variety of perspectives which we discuss might alleviate the pressure

The truth in bumper stickers

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Its often said that bumper stickers carry harsh truths wrapped in comedy. On the highway yesterday see exhibit A – “After you please to save the earth”. This is a good reference to human behaviour. How often we see that the people who preach the global warming faith often  don’t practice it. Gas guzzling SUVs continue to dominate new car sales charts and according to the IATA air travel is expected to “double” by 2030. After all when 50,000 climate alarmists fly to exotic locations half way around the world  every year to kneel at the altar of the UNIPCC and tell us why we must cut our environmental impact. Then again we only need listen to IPCC co-chair of a working group Dr Ottmar Endenhofer who in his own words said, “We [UNIPCC] redistribute de factor the world’s wealth by climate policy…one has to free oneself from the illusion that international climate policy is environmental policy. T has almost nothing to do with environmental policy anymore”

How the fishy mainstream media keep getting stuck on their own clickbait – hook, line and sinker

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They can’t help themselves. There is not one attempt to be objective. The mainstream media is so fueled with Trump hatred that they won’t let facts get in the way of a good story. The full video of Japanese PM Abe emptying his fish food by tipping the box before POTUS followed suit was actually pointed out by someone progressive, presumably tired of seeing this biased one-sided reporting. Indeed he knows full well that the mainstream media risks alienating even their own ranks if there is no attempt to be impartial. Remember the “we got ‘em!” statement from MSNBC’s Rachel Maddow referring to Trump’s tax returns? The insane thirst to play the man not the ball, which back-fired so badly that even the left turned on her for being so obtuse and showing that he legally paid a lot of tax.

Yes, the President has many short comings but trying to beat him up over trivial things like paying taxes or tipping a box of fish food only proves why trust in the media languishes well below his own sub-par rankings.

Therein lies the problem. It seems media is completely dominated by ‘clickbait’. Every journalist hoping that they get the ‘break’ which sends them to the top of ‘trending’. So regardless of content quality, a clickbait headline and heavily edited video is enough. Sadly it doesn’t take long for it to be disproved by some other video footage showing the opposite. Yet they never learn.

However the people that seem to trend are those who come from utter obscurity. Take former Arizona Police officer Brandon Tatum whose videos went viral because of the content. Over 70 million views of his first video. He now works at the Conservative Tribune.  Such was the ‘content’ that the media came for him, not him chasing the platform for glory.

Is it any wonder profitability of the mainstream media wallows. A strong driver for this blog was because I became sick and tired of one-sided reporting from both sides.

Yet I will never ask for likes or shares because that is for you, my audience, to decide for yourselves. That is the ultimate test of any product – a value proposition. If the growth of the blog doesn’t take off then it is a problem of content or the delivery. That is perhaps the most fascinating element of writing the blog – to see which subjects actually engage. It is growing, so to that extent I need to work out why, but I won’t be commentating on exciting topics such as fish food delivery do’s and don’ts.

Japan exported 90,000 firearms to the US in 2015

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Peace loving Japan exported just shy of 90,000 civilian rifles and shotguns to the USA in 2015, up from 49,000 in 2010. This makes Japan the 11th largest gun exporter to America. Reading through the list of Japanese makers, Howa Corp (6203 JP) said its weapons sales (domestic military and overseas civilian) hit around JPY3.3bn last financial year, a drop of 25.7%. It is  expecting another 10% drop this year due to sluggish domestic sales. Weapons make up 18% of the group’s revenue with machinery the bulk of turnover at 42%. The shares have performed pretty well despite the 17%YoY decline in group revenues and Y437mn loss in March 2017. Although in March 2018 fiscal year Howa is expecting a 11% rebound in revenue at Y20.5bn and Y330mn operating profit.

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The firearms division is expected to be the biggest drag on profits at -Y190mn in the coming fiscal year. The company is hoping that its real estate investment division will be the big prop up in the turn around at +Y370mn for FY3/18. For all the good will in the company seems to be ripe for a restructuring. The Japanese language business plan can be seen here. It is a stock that trades by appointment but it smells of a company in need of direction.