AOYAMA VIEW 11.11.2019


As always, there’s good news and bad news. Shuri Castle’s glorious Grand Hall lost in sudden fire will be rebuilt again, but it will take years. The detailed restauration plans alone will take 3 years, it is said. Public reaction to the catastrophe was much quicker: private donations from around the country amounted to JPY 237 million or over USD 2 million in just one week.

Typhoon damage from Nos. 15 and 19 for agriculture and forestry alone is put at JPY 218 billion (USD 2 billion), but there’s no estimate yet for cost of damage to public infrastructure and private property. Over 80,000 homes were destroyed or damage and the amount of furniture, tatami floors and other interior goods thrown away as garbish amounted to 11 million tons. That will take a few years to burn. Government thinks the total cost will be worth several trillion yen and plans necessary funds to be included in a supplementary budget for FY2019 to March and the fiscal budget 2020 that will take effect from April.

Happily, the economic impact from the VAT hike that took place just after this havoc seems to be less painful than feared and coincident index of business conditions took a small step up even if government’s offical expression of economic conditions remains “worsening”.


The Imperial couple finally had their open car parade through the town on Sunday cheered by packed crowds. They also greeted people from the palace balcony, but to get there was a lottery: 10,000 lucky winners out of 470,000 applications.

Another lottery for Olympic tickets, second one for Japan residents, will start this week. Most applicants missed out on 3,5 million tickets dealt out in the first one and one million more will be available now. Prices are reasonable and strict security measures are imposed to prevent hoarding and scalping – it’s just that demand surpass supply manyfold. Personally, putting my money on special tickets at just JPY 2000 reserved for families with senior citizens. See what comes out.

It will be more expensive to see the two marathons and two walking races that IOC in its suddenly found wisdom decided to shift to Sapporo. For that you have to take a plane and get a hotel room there – both difficult even for participants. Hotels there are heavily booked already as it’s top holiday season and Hokkaido cool is considered a nice relief from heat for all citizens, not just marathon runners. (Interestingly enough, para-athletes on wheelchairs etc say they can manage their marathon races in Tokyo heat and they are not controlled by IOC whims.)

Prime minister of 2000-2001 and the current one (内閣官房内閣広報室 [CC BY 4.0 (]

Wonder how JOC, suddenly burdened with the change, will manage to get it all arranged for the participants and their support teams. Only half of the Sapporo people are happy to take over this “hand-me-down” from the Lausanne lords and local sport arrangers wonder if they can gather 4000-5000 volunteers needed for the races. Seems Abe and Mori are prepared to pay for all extra costs – you did not seriously expect IOC would pay anything, did you?

What’s clear is that the route will be much less TV-friendly than Tokyo’s exquisite plan through historic monuments and seaside scenery and the winner will not enter from tunnel into the Olympic stadium to huge cheer from 60,000 strong audience. Nor will this Olympic landmark event take place on the last day as usual together with the ending ceremonies. Let’s make it clear: it will be an “IOC marathon”, not Tokyo Olympic marathon.

No matter what happens, Masayoshi Son always manages to keep a sunny face (

Reports on big manufacturers’s quarter results have started to pour in. US-China trade war and decline in global demand continue to make their mark and overblown belief in technology start-up’s has added its negative mark. The total profit downgrade of listed companies so far amounts to USD 8 billion, the biggest since 2011, and it’s clear we can expect more to come. Companies with high share of China sales are worst off with robot maker Fanuc tumbling 62%, mobile phone part maker Nitto Denko 22% down and construction machinery maker Komatsu projecting 30% decline.

Softbank’s collapse from USD 11 billion profit in April-June to USD 6 billion loss July-September on its big investments in US tech start-ups has attracted the biggest headlines. It was the first ever quarterly loss in 14 years for the local mobile carrier turned into global investor and personal embarrassment for Son-san, a financial gambler, who always got things right in the past.

While Uber has lost a fair part of it value since its IPO, shared office supplier WeWork was the real bloodbath. Valued at USD 47 billion for its planned IPO, it’s now considered practically worthless – official booking value was USD 7,8 billion – and Softbank had to rescue it from bankruptcy with USD 9 billion emergency loan plus pay another USD 4 billion to take control over 80% of the shares and get rid off the megalomaniac, fraudulent founder. All this on top of more than USD 10 billion that Softbank and its Vision Fund had earlier invested into the company. The losses were booked under the fund shared with Saudi Arabia and Softbank took its share of them.


Son’s reputation as financial wizard got a big dent – he placed his first billions into the venture mesmerized by the founder’s fancy visions in just 11 minutes face-to-face like any amateur – and the conglomerate has now introduced new strict rules to rein in its leader. Yet, cannot help admiring Masa’s performance in presenting all red ink to the shareholders: it was so precise, cool and controlled without any papers, admitting all as his own fault with no excuses.

Seems investors were as impressed as the share price did not decline much at all after such catastrophe.

One of the last slides on Softbank's Q2/2019 result presentation. Though some companies put out bad results, they are confident in their longterm vision. (
Some of the cars Tokyo had on display at Tokyo Motor Show 2019. e-RACER and e-PALETTE (

With rest of Japan seeing red and other global automakers experiencing troubles with sales decline, Toyota still managed to turn out positive result. Its group net profit rose to a quarter record JPY 1,27 trillion (USD 11 billion) with sales up 4% in all main markets and operating profit rising 11%. All this with markets in decline all over and currency rates working against the repatriation value. Shows that, despite all talk of full electric EV cars, there’s still big demand for Toyota’s hybrid technology. In contrast, its fuel cell technology FC cars have hardly taken off at all, not even in Japan, as there is little infrastructure to support them.

True to its careful style, the Nagoya company kept its outlook for the full year unchanged with sales and group net profit expected to end marginally down. What’s new is that Toyota announced decision to use up to JPY 200 billion (USD 1,8 billion) to buy back some of its own stock. As well, it announced a new JV with BYD, China’s leading electric car maker 25% owned by Warren Buffet’s Berkshire Hathaway. Clearly, Toyota plans to make up its slow start in China and catch up with VW and GM, who are big there. Already now, Toyota’s sales of current models have grown 10% there despite 5% market decline. In comparison, GM sales declined 17% in China and 11% globally.     

Let’s also recall that Toyota has increased its share of Suzuki, who is No.1 in India, another potential growth market albeit in deep decline this year. Suzuki was about to open a new factory there, but postponed the start at last moment.

Next step of interest is Nissan’s quarter result out this week. Afraid the steep decline has continued – let’s see.



The long expected opening of  the new Muji shop in Helsinki was big news in Finland on Friday. The waiting lines in snaked 500 meters out of Kamppi shopping center. Believe no other single shop opening has attracted so much attention before. Minister of Foreign Trade attended the “kagamiwari” ceremony and local marketing experts explained in media Muji’s clever brand-without-brand strategy that has gained such strong support all over the world.

Hope the interest will hold in Finland. Wonder if we can expect Uniqlo there next?

Same day here went to see the new Shibuya Scramble Square, a tower with 16 floors of exquisite shops and eateries with another 28 floors of offices above them. It‘s the third step in Tokyu Corp‘s grand plan to revitalize the entire Shibuya station area – they call it “NeoShibuya”. Two more new towers are already under construction before the final step to rebuild the old Tokyu department above the station itself.

Unexpectedly, Scramble’s shops are all lifestyle and fashion as well as eateries with many kinds of etno food. Yet, impressed with the landlord’s choice of tenants: no old big French/Italian brand names, no Michelin restaurant nor cheap fast food. Itinerant in fashion, I only recognized Nike, Apple and Marimekko as well as Tokyu Hands and big Tsutaya book shop. Instead interested in eateries: traditional Japanese represented by monjayaki, Chinese by gyoza and shumai, two Spanish/Mexican bistros and topping it all with Middle East with wines from Georgia, Greece and Lebanon!

Have to pay better visit there once the crowds get smaller. There‘s also 54th floor Sky Lounge, but lines for the special lift looked like one hour wait.

Shibuya Scramle Square, yet another new high rise in Tokyo
(江戸村のとくぞう [CC BY-SA 4.0 (])

Timo Varhama

Tokyo, November 11, 2019