This Almost Sounds Like the Start of a Bad Joke…

With two kids in college and one about to finish high school, I’m no longer required to spend countless hours at a sports field or in a gym watching others compete. This gives me more time to pursue my interests, so I’m considering new hobbies. I like the idea of music, but I’ve been told my natural abilities are lacking. Maybe I could jump on our demographic bandwagon and buy a motorcycle, adding a bit of excitement to the next phase of my life.

There are lots of possibilities, and I’ll consider many different things. But there’s at least one area that holds no interest for me: potted plants.

While I appreciate greenery in a plastic bucket as an accent in a room, I don’t think of establishing and caring for potted plants as much of a hobby. That’s not to say it isn’t work. I get that growing vibrant, diminutive trees and flowers is difficult. I’ve killed more than my share of indoor vegetation. But it doesn’t really strike me as, well, active.

Maybe I’m too American. Even as adults, we tend toward hobbies that scream we’re still vibrant, still in the prime of life. It could be that we still have that Wild West attitude about us, even though the West was tamed over a century ago. Or it could be that, collectively, we’re still young.

The situation in Japan is very different.

The demographics of the Land of the Rising (or is it setting?) Sun are well known.

One in four people are over the age of 65. They have more household pets than children under the age of 15. More adult diapers are sold in Japan than baby ones.

We can now add another qualification to the group, and this one sounds like the start of a joke. The people of Japan are so old, they think of potted plants as a hobby!

Once every five years, the bureaucrats behind the Statistics Bureau of Japan (SBJ) scrutinize the 585 items they track as a reflection of daily life. These items make up the country’s inflation measurement.

They remove things that are no longer common, and add things that have grown in popularity. The 30-odd items to be struck, as well as those now making the list, give us a sense of just how old the country has become.

Sample of Proposed Changes to Japan CPI Basket

Gone from the measure of inflation is the cost of a kid’s lunch, as well as that of a pen case and thermometer. The trappings of daily life with children are fading from society.

Also on the cut list is the cost of renting a tennis court, which means that the aging population is either shifting its activities to other sports, or simply fading from sports altogether.

The answer to that question can be found on the list of added items. Under the “Recreation” heading, the only entry is the aforementioned “Potted Plants.”

What makes this even more confusing is that one of the items to be removed is “Plant Pots.” So aging Japanese are spending recreational money on potted plants, but not the pots to put them in?  Strange indeed.

The shake-up of the inflation list provides other insight as well. Gone are coffee cups and saucers, glass cups and wine glasses. It’s not that people are drinking less, it’s that they’re not spending as much on the cups and stemware.

Along with the rising popularity of pets and plants, Yen100 shops are also booming. These stores sell all items for under 100 yen, which is roughly $0.81. Penny-pinching Japanese pensioners flock to such markets, buying tableware and much of everything else they need. But you don’t see this in the inflation list, because when a glass costs 100 yen, it’s too small of a purchase in the typical 300,000 yen ($2,419) monthly budget to be included in the inflation calculation.

Among the other telling items being added are home security systems, knee supports, hygiene masks, and hearing-aid devices.

If there was ever any doubt that the Japanese society was slowly aging out of existence, the changing measure of inflation should put that to rest.

As their population ages, we can expect their spending to slow even more, with deflation as the constant threat to their economy. Without a significant rise in births or a flood of immigration, the trend won’t change.

While the situation is sobering, there was a little happy news tucked into the statistics.

The Japanese are spending less on scales and more on fried chicken. If they’re going to spend their days frequenting budget stores and staring at potted plants, at least they intend to eat well and quit worrying about their weight.

Rodney Johnson

Rodney

Follow me on Twitter @RJHSDent

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Categories: Inflation

About Author

Rodney Johnson works closely with Harry Dent to study how people spend their money as they go through predictable stages of life, how that spending drives our economy and how you can use this information to invest successfully in any market. Rodney began his career in financial services on Wall Street in the 1980s with Thomson McKinnon and then Prudential Securities. He started working on projects with Harry in the mid-1990s. He’s a regular guest on several radio programs such as America’s Wealth Management, Savvy Investor Radio, and has been featured on CNBC, Fox News and Fox Business’s “America’s Nightly Scorecard, where he discusses economic trends ranging from the price of oil to the direction of the U.S. economy. He holds degrees from Georgetown University and Southern Methodist University.