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Thursday, June 6, 2002

THE ZEIT GIST

Looking at the bright side of Japan's cash woes


One of the most soul-destroying experiences of my life in Japan occurred back in 1986.

I had just arrived here and needed to find an apartment.

My real estate agent had a punch perm, ample gold jewelry and gravelly voice, an appearance suggesting the yakuza rather than your friendly neighborhood home finder.

He reluctantly accepted me as a customer, but warned me that because I was a foreigner I couldn't expect much in the way of choice, as nearly all landlords had no desire to rent to anyone who was not Japanese.

His bearing was so intimidating that I felt no compulsion to bring up such petty issues as discrimination.

Thus, I was given the grand choice of -- one place.

It was nice enough, but well beyond my budget. I took it anyway, over the fear I could end up sleeping in the street, or even worse, in a decrepit gaijinhouse.

Now let's fast forward to 2000, when I was again in desperate need of somewhere to live.

This time, when I popped my head into a real estate agent office, I was in for a shock.

Three cheerful young clerks in uniforms pulled up chairs, offered tea, and got busy with files while assailing me with a barrage of questions about what kind of apartment or house I was looking for.

They offered to take me immediately around to a number of places.

No one brought up the issue of me being a foreigner.

In short, I was being treated like a true o-kyakusama, or honorable customer, and the contrast between that treatment and my experience in 1986 could not have been sharper.

So what on earth had happened between 1986 and 2000 to make such a difference?

The answer is the deepest economic downturn in Japan's recent history.

One of the main features of this recession is a plunge in land prices.

That's bad news for landlords, who have found themselves in a buyers' market. But it's good news for foreign working stiffs like myself, now no longer at the mercy of narrow-minded and super-wealthy landowners, not to mention dodgy real-estate agents.

Indeed, I have done well by Japan's decade of bad economic times, perverted as that may sound.

What's more, many other long-term foreign residents might tell you the same thing. Just think back to the economic bubble of the mid-80s to early 90s, an era of spectacularly high rents and prices. Remember the reports of $20 cups of coffee and million-dollar golf club memberships?

The stories grabbed global headlines, helping make Japan's economy the envy of the world.

I, on the other hand, found it all very depressing.

These days, however, what I don't find depressing are these supposedly grim reports of Japan's deflationary spiral.

Consumer prices are falling, the cost of living is going down! the newspapers warn darkly.

Well hold on, thinks I, isn't that actually good news, at least for peons like myself?

Well, "yes" in the short term but "no" in the longer term, as any smarmy economist will tell you.

Among other things, falling prices squeeze corporate profits, making it harder for corporations to pay back their massive backlog of loans, many of which are now on the verge of souring.

Companies thus downsize or go out of business, and we end up with fewer jobs and lower salaries.

Still, call me selfish, but when I saunter into my local 100 yen store such thoughts are the very last thing on my mind.

These stores have proliferated throughout the recession, and have moved decidedly upmarket.

A three-story emporium store in my neighborhood sells everything from imported tablewear to potted plants to automotive accessories. All for 100 yen per item.

The stores are products of a decade of bad economic times, which have spawned a new generation of price-conscious (that's a euphemism for "stingy") Japanese consumers.

Another sign of the times is the growing presence of such foreign retailers and service providers around the country as Tower Records Inc., GAP Inc. and Starbucks Coffee Japan, Ltd.

Thanks to them, we have selection and low prices that a decade ago were hard to imagine.

The recession has made it easier for these ventures to set up in Japan, as the government is increasingly looking to deregulation and foreign direct investment to inject life back into the economy.

So I plan enjoy the bad economic times while they last -- as long as I don't find myself among the swelling ranks of the unemployed.



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