[Bread-Baking Typewriter] Jim Rogers' Cry "Japan, You'll Go Bankrupt That Way"

'Jim Rogers' Warning to Japan' / Written by Jim Rogers / Translated by Oh Si-yeon / Ire Media

[Asia Economy Reporter Kim Jihee] In the fall of 2018, one of the world's top three investors sold off all of his Japanese stocks. That person was Jim Rogers, a prominent pro-Japan figure. At that time, Rogers predicted not only the decline of the Japanese economy but also the disappearance of Japan itself. Why did this investment genius make such a decision?

Rogers, the author of Warning from Jim Rogers to Japan, bases his conviction about Japan's crisis on its demographic structure, summarized by low birthrates and aging population, and its enormous long-term debt. Japan consistently maintains a passive stance toward defending its birthrate (2.1 children per woman) and accepting foreign immigrants to sustain its population. Meanwhile, as of the end of 2018, Japan's long-term government bonds surged to 947 trillion yen (approximately 1,228 trillion won).

Adding fuel to the fire is the "absurd policy" of Abenomics. Introduced under the special mission to overcome the manufacturing industry's crisis, Abenomics has caused a stock market boom comparable to the bubble era and an annual fiscal deficit close to 100 trillion yen. This explosively increases the debt.

Japan is proactive in injecting unnecessary public funds that raise its debt level. The author cites the Tokyo Olympics, scheduled for next year, as a representative example. According to the author’s prediction, if this continues, Japan will become a country of crime and riots in 30 years.

Based on all these circumstances, Rogers’ judgment is quite confident. "Currently, I do not own any assets related to Japan, whether stocks or currency, and I have no intention to buy any in the future."

He advises that to avoid crisis, Japan must directly respond to population decline by opening the country and to its massive debt by cutting expenditures. Especially regarding immigration, he points out that discrimination against foreigners must be eliminated and that actively attracting foreign students will increase opportunities for global exposure. He explains that as long as immigrants are not accepted too quickly or in too large numbers at once, there is no concern that society will become unstable due to immigrants.

Warning from Jim Rogers to Japan also contains an analysis of the future of the Korean Peninsula. In his previous book, The Most Stimulating Country in the World, the author predicted that Korea would become the happiest Asian country in five years. He also portrays the future of the Korean Peninsula quite positively in Warning from Jim Rogers to Japan. The fiscal deficit and severe low birthrate and aging population that he cites as reasons for Japan’s economic collapse superficially resemble problems facing our society. The fact that the top desired job for job seekers is a government official and that many women find it difficult to balance work and childcare even evokes the illusion that this is our story.

However, the author draws a line, stating that Korea and Japan are different. The representative difference is closed-mindedness. Japan, which neither has children nor accepts immigrants, even hesitates to expand abroad. Korea also has a conservative attitude toward foreigners. However, the Korean temperament is somewhat more open than that of the Japanese. The passport ownership rate in 2017?22.8% in Japan, 42% in the U.S., and 61% in Korea?is a clear example showing the closed-mindedness of the Japanese.

Another reason Korea’s future is bright is the existence of North Korea. Aging and conservative attitudes toward foreigners are problems Korea shares with Japan. But Rogers believes most of these problems will be resolved through inter-Korean unification.

He focuses on North Korea’s potential. Based on China’s precedent, he believes that once the gates open, North Korea will achieve rapid economic growth. The author highly evaluates Kim Jong-un, who has led changes such as starting with the construction of ski resorts in 2013, designating 15 free trade zones, and hosting the Pyongyang Marathon. He is confident that the combination of Koreans’ open temperament and North Korea’s abundant resources and labor will attract global capital to the Korean Peninsula.

However, contrary to the subtitle The Future of Japan and the Korean Peninsula Seen Through the Flow of Money, it is difficult to expect deep insights about Korea. Rogers’ rosy outlook on Korea is neither detailed nor particularly sharp. Warning from Jim Rogers to Japan is fundamentally a book intended to raise awareness about Japan, which ignores reality and covers debt with more debt.

This content was produced with the assistance of AI translation services.