Until not long ago Japan was criticized -- or praised -- for its extraordinarily high savings rate, depending on how one looked at it. The United States, for one, pointed out that Japan was saving too much and investing too little, and called for steps to stimulate domestic demand and boost consumer spending. How times change. Japan is no longer a nation of overeager savers.
Statistics show that more and more Japanese households are dipping into their savings to cover living expenses. Reduced income and extended unemployment are some of the immediate reasons. A private study predicts that the savings rate will amount to almost nothing by the late 2010s if it continues to fall at the current pace.
According to figures from the Bank of Japan, the total amount of financial assets held by Japanese individuals -- such as savings, stocks and bonds -- has continued to shrink since the end of March 2000 when it peaked at 1,428 trillion yen. Three years later, at the end of March 2003, the balance stood at 1,378 trillion yen.