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Our mission is to unmask Japan to reveal the real consumer truths

No Matter What the Movies Tell You, the Craziest Rich Asians Are Still the Japanese

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By Dominic Carter


When you were a kid, did you ever have that one friend you thought was perfectly normal, just like you, until you got invited to the kid’s house and . . . WOW, you realized your friend was rich and possibly not like you at all? Appearances can certainly be deceptive.

Extending that wise warning into the realm of romance was the late 2018 hit movie Crazy Rich Asians. The madcap rom-com flies us from New York (where two young Asian-born economics professors have fallen in love) back to the boyfriend’s native Singapore, where it turns out he’s actually one of the city-state’s most eligible bachelors thanks to a billion-dollar family fortune. His girlfriend Rachel, who’s from a more grounded American background, is caught completely and amusingly off-guard.

Asia loves to flaunt its wealth

The image of Asia has come a long way in the last few decades: From an image of industrious but exotic disadvantage, the prosperous Asian with money to burn is the new popular persona– people who, without a second thought, blow their money on extravagances like limited-edition designer handbags and jewelry costing the equivalent of a small country’s GDP.

Set primarily in Singapore, Crazy Rich Asians also features luxurious getaways to nearby tropical resorts and lavish parties thrown in to create the image of an insanely opulent life. “These people are richer than God!” exclaims one of the characters.

Looking at the data, the notion of the super-prosperous Singaporean is not that far fetched. Indeed, approximately one out of every 30 people in Singapore is a millionaire, putting the tiny city-state sixth in Asia in the ranking of countries with the highest number of high net worth individuals (HNWIs). The definition of an HNWI includes anyone with at least one million US dollars in investable assets (property you live in and consumables don’t count here).

China, with many of its uber-wealthy represented in the Forbes 100 list of the world’s richest people, comes a close second in this ranking. The escapades of their heirs flaunting their wealth often garner attention on social media, which may have you believing the Chinese are in fact tops in the world when it comes to liquid assets. The latest example is the #fallingstarschallenge, in which Chinese rich kids have seemingly tumbled out of their Aston Martins, face down, with luxury goods scattered around them.

Dubbed the “stealthy wealthy,” the Japanese are still the richest Asians

But if China sits at number two, who’s holding the crown in the wealth stakes? Surprise, surprise it’s the Japanese, who head the list with the most HNWIs in Asia—and are second in the world only to the USA’s wealthy horde. One in every 17 Japanese households, in fact, has over a million dollars in disposable assets. On average, Japan’s HNWIs are worth around US$2.5 million, and collectively held US$7.7 trillion in assets in 2017, compared to the US$6.5 trillion their Chinese counterparts possessed.

So why is Crazy Rich Asians set in Singapore and not in Japan? Because like the movie’s protagonist, Nick Young, who lives a relatively humble life in his chosen home of New York, the Japanese don’t flaunt their wealth. In fact, they live, consume and dress in ways that make them virtually indistinguishable from the country’s upper middle class. This has led media outlets to call them the “stealthy wealthy.”

Why conceal your wealth? The traditions and culture of Japan are guided by Zen Buddhist principles that preach modesty as a virtue, but one could say the same about China, where Buddhism has strong influence also. Since this argument alone probably isn’t enough, maybe we should examine Japan’s overall economy.

The Japanese certainly earned the image of the wealthiest nation on the planet in the past. During the so-called bubble years, which peaked in the late 1980s, brand-flaunting, overspending and luxury travel were much more common than what we see today. We could say on an emotional level that Japanese society has outgrown its teenage years of obscene displays of wealth, and on a practical level a long series of lean years following the fat ones has crimped their ability to do so. During the so-called lost decades —the period that followed the bubble era—Japan’s economy plunged into a perpetual state of deflation, a downturn that was only halted by Abenomics a few years ago.

And while Japan’s GDP has grown by 7 percent in the last five years under Shinzo Abe’s policies, wages have in fact declined by 4 percent, so where did the money go? Well, between 2010 and 2017 the wealth of Japan’s HNWIs grew by 87 percent. In other words, they’re the ones who profited, so it might not be advisable for them to flaunt what they reaped. Which brings another quintessential Japanese value to mind: harmony. Japan’s HNWIs concealing their assets keeps society harmonious, which is better for everyone.

Japan’s luxury market is mature but showing some muscle

So while their continental Asian counterparts may have fallen victim to high-priced fixations—including the incessant urge to buy difficult-to-acquire items and get seats in the first row at Gucci and Chanel shows—you’ll probably not find Japanese tumbling out of their luxury rides en masse anytime soon. The Japanese are investing in very different areas. Our research shows that the older monied generation of Japan—the so-called dankai generation, aged 65 to 69—prefer to splurge on healthy and convenient living and living life to the fullest after they’ve retired. Those with the means are interested in topnotch medical care, luxury home remodeling and bespoke travel.

Their younger counterparts—the “Dankai Junior” generation—born between 1970 and 1979, prefer to invest in their health and their future. We discovered that this generation focuses on spending top yen on imported health and organic foods, education for themselves and their children, real estate, insurance, travel, and beauty and cosmetics that follow healthy and organic trends.

While China’s luxury market shows hotter growth rates than Japan’s, it is also fluctuating wildly. In 2018, for example, China’s super-rich lost out big-time. The net worth of more than three-quarters of last year’s top 400 richest Chinese fell, and 93 of them dropped out of the rankings entirely. In contrast, Japan’s market may be mature, but it is still robust and even expanding. In fact, the number of the country’s HNWIs rose by 9.4 percent in 2018 compared to the previous year. They say diamonds are forever, and for Japan’s stealthy wealthy some values—including health, education and securing their future—will likely never go out of style. And call me crazy, but I expect that our clients will do just fine in the years to come meeting that demand.


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