As a torchbearer of long-term investing, I’ve heard this statement: show japan now about a million times.
These three words were one of the biggest inspirations in my writing. Risk and Reward.
With a situation like Japan’s, how can you invest in stocks for the long term?
It’s a fair question.
In all the interviews I did for the book, the topic that came up most was Japan.
Are we in a bubble just like Japan?
Isn’t Japan the exception to the long-term investment rule?
Could the same thing happen here?
I find the subject of Japan’s rise and fall extremely fascinating. Surprisingly, there aren’t many books about what I consider to be the largest financial asset bubble in history.
I can write at least two chapters on the subject so that you have a better understanding of what is happening.
my first step Harriman House In the book, each topic was given its own yin and yang (risk and reward) sections. One episode will look at a historical risk in the markets to show how bad things can get. The following section will provide some context about these risks and offer different ways to protect yourself.1
The two chapters on Japan were my favorite chapters to write.
Now let’s look at some data from the book to illustrate Japan.
The times of the explosion were beyond ridiculous:
Valuations are as follows:
The next chart is very important:
Long-term investing worked in Japan!
The problem is that returns were so compressed into the 1970s and 1980s that performance in the subsequent decades had to be downright awful to even things out.
There is much more context, story, data, and explanation in the book.
If you want to learn more about the largest balloon in history, buy yourself a copy:
Further Reading:
International Diversification Status
1I even toyed with the idea of naming the book Now Show Japan. That would be a little too into baseball.
