Japanese Housewives

Remember Mrs. Robinson from that whole "coo coo cachoo" song? Simon and Garfunkel?

Well, today we’d like to talk about Mrs. Watanabe, also known as Japanese housewives.

Mrs. Watanabe is largely responsible for stabilizing the Japanese currency market. “Mrs. Watanabe” is the slang name given to the archetypal Japanese matriarch, a housewife who is all about stretching her family’s dollars as far as they will go. Just so we’re all on the same page with our cultural references here.

Anyhoo, back in the early 2000s, the interest rate in Japan was hovering riiiiight around zero. Nobody's investment portfolios were making any money. Investor confidence was low. Then, one night, a bunch of Japanese housewives got together and said, “the heck with Bunko—let’s get into currency trading.” And they did. (And no, we’re not exactly sure that’s how it happened, but we really like the visual.) And the result was that all of those individual retail investors managed to slowly bring the currency market out of its funk. It’s still not completely funk-free (Japan still has crazy high debt, crazy low lending rates, and notoriously timid investors), but we’ve recently seen signs that it’s improving.

All those Japanese housewives—er, retail investors—are now known collectively as one entity—the formidable Mrs. Watanabe, singular—and they currently hold over 16% of Japan’s domestic stock shares. That’s some serious financial power. And as Japan continues to push for more market activity (i.e., more lending, more investing), we’re seeing the power of the Japanese housewives’ purses continue to grow.