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Blueprint for Japan 2020Blueprint for Japan 2020
Joichi Ito (Neoteny)Joichi Ito (Neoteny)
Oki Matsumoto (Monex)Oki Matsumoto (Monex)
Blueprint for Japan 2020
Blu
epri
nt
For
Jap
an 2
020
Condition of Diversity (1)
0
10
20
30
40
50
60
70
JAP
AN
GE
RM
AN
Y
FR
AN
CE
ITA
LY
UK
CA
NA
DA
US
A
(%)
0
20
40
60
80
100
JAP
AN
UK
US
A
FR
AN
CE
GE
RM
AN
Y
CA
NA
DA
ITA
LY
PE
RC
EN
TA
GE
Feb 1999 July 2000
• Entrepreneurship is not socially accepted
※The graph on the leftPercentage “yes” on item: People you know respect those starting a new business
• Japanese Afraid to Start Companies
※The graph on the rightPercentage “yes” on item: Fear of failure would prevent you from starting business
Blu
epri
nt
For
Jap
an 2
020
Name-brandUniversity GraduatesOthers
Condition of Diversity (2)
32%
4%
1955
LDP related
LDP unrelated
PNC
DNC
2002
(In U.S.)
1955
LDP related
LDP unrelated
PNC
DNC
2002
(In U.S.)
RulingParty
※ The circle inside is all University Graduates. The circle outside is all Presidents of Japanese listed Companies
•Japanese society have a bias for Academic Background.
The name-brand university graduates that occupy 4% in all university graduates occupy 32% in all presidents of Japanese listed companies
Blu
epri
nt
For
Jap
an 2
020
Condition of Democracy (1)
“Me too” contents of Japanese newspapers
Journalists are shut out by violation
70% of date source of Japanese major newspaper are from Press Clubs
Abandonment of Agenda Setting
Adhesion between government and journalists
Circulation of NewspapersBad Influence of Press Clubs
0
200
400
600
800
1000
1200
U.S.A. today WSJ Nikkei Mainichi Yomiuri
(10 thouand)
Blu
epri
nt
For
Jap
an 2
020
Condition of Democracy (2)
Unsuccessful Successful
0
20000
40000
60000
80000
100000
120000
140000
Rate to the smallest number
0%50%
100%150%200%250%300%
Shim
an
e3
Koch
i 3
Shim
an
e2
Toky
o 2
2
Kanagaw
a7
Kanagaw
a14
• Those who got less poll than
the unsuccessfuls were elected.
• A vote in some districts have double value to one in other districts.
Blu
epri
nt
For
Jap
an 2
020
Condition of Democracy (3)
25
35
45
55
65
75
20~24
25~29
30~34
35~39
40~44
45~49
50~54
55~59
60~64
65~69
Over70
PE
RC
EN
TA
GE
41 Accounts payable 13
Securities 112Short-term Governmentsecurities held by the public 39
Accounts receivable 22 Government bonds held by the public230Loans receivable 286 Postal savings 260Money in trust 22 Public pension liabilities 797Allowance for doubtful accounts-2 Advanced received 18Tangible asset 176 Reserves 28Intangible asset 0 Insurance reserves 107Investment 42 Others 16Others 2Total Assets 701 Total liabilities 1508
The Japanese Government Balance Sheet (Trillions of Yen)
• The difference between Assets and Liabilities is 806 Trillions of Yen <Insolvent!>
• The young generations that will pay 806 trillion yen do not vote very much in national elections.
Blu
epri
nt
For
Jap
an 2
020
Condition of Capital Markets (1)
Rate of Market Capitalization to GDP
PBR of TSE listed Companies
PBR < 1 PBR > 1
0
2000
4000
6000
8000
10000
12000
Japan U.S.
(Bill
ion
s of
Dolla
r)
Market CapitalizationGDP
※ Market Capitalization of Japan is derived from TSE. Market Capitalization of U.S. is derived from NYSE and Nasdaq.
Blu
epri
nt
For
Jap
an 2
020
Condition of Capital Markets (2)
Case of a large Japanese bank:
Without any reduction of capital, about 20 billion dollars of public money was injected.
On an annual announcement of some billion dollars of newly borne write-off for bad loans, the share price stays the same level.
The share is still trading with the market capitalization of the bank to be about 20 billion dollars.
Blu
epri
nt
For
Jap
an 2
020
0% 20% 40% 60% 80% 100%
U.S.
Japan
Cash & Deposit Bond Investment Trust Stock Insurance Others
54%
11.9% 34.1%
7.2%
Japanese do not invest much into Stocks
1420Trillion Yen
32.1Trillion Dollar
Condition of Capital Markets (3)
Blu
epri
nt
For
Jap
an 2
020
Diversity is not recognized in Japan
Needs to prevail the sense of diversity
Needs for educational reform
Needs for more to communicate in English
………
Diversity - Analysis
Blu
epri
nt
For
Jap
an 2
020
Democracy - Analysis
Democracy is not established in Japan
Needs for the election system reform
Needs for the media to become independent
Needs for more disclosure of the nation state
………
Blu
epri
nt
For
Jap
an 2
020
Capital Markets - Analysis
Capital Markets is not working in Japan
Needs for the independent SEC
Needs for the reallocation of resources
Needs for transparent corporate governance
………
Blu
epri
nt
For
Jap
an 2
020
What to do?
One idea is to create new indices,
…not GDP, not Market Cap.
Japan Diversity Index
Japan Democracy Index
Japan Capital Markets Index
…and we track them.