00:00Most people's expectation of Japan, or business mindset of Japan, is 30 years of stagnation.
00:06I think, you know, we call the lost ages during decades, and we do not have substantial growth in Japan.
00:16Japan faced deflation for a very, very long time.
00:19Japan has been, you know, suffering from deflation for more than two decades.
00:24In the late 80s, Japan's economy grew by as much as 6.7% a year.
00:30Only to have that growth plummet for most of the next 30 years, hovering between 0% and 2%,
00:36and contracting during the great financial crisis and the COVID pandemic,
00:41relegating what had been the third largest economy in the world to number four as Germany surged past.
00:46The Nikkei stock market went 34 years without setting new highs.
00:51Japanese government bond yields turned negative and stayed there for years.
00:55But all that could now be changing, as Japan emerges from those lost decades.
01:01What a lovely day in Tokyo.
01:03Mark Rowan is CEO of Apollo Global Management.
01:06This is a savings culture.
01:08And holding on to your cash or leaving your money into JGBs for the past 30 years has been fine
01:14because there's been no inflation.
01:16In fact, there's been deflation.
01:18All of a sudden, you have closer to 3% inflation, you have interest rates up for the first time,
01:24and that savings is going to be deployed productively.
01:29And now some of it has to go toward retirement.
01:32They will want better solutions for retirement.
01:34But some of it is just going to keep up with purchase price and purchasing power.
01:38I think about what's happening in Japan, and in Japan, they're going through generational change, and it's generational change in
01:46corporate governance, it's in interest rates, it's in government policy, and in many ways, they are the first of the
01:53Western democracies to face real aging, retirement, and high levels of government debt.
02:00And what's happening here is totally different than people's expectation.
02:04And what's happening here is totally different than people's expectation.
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