Japan may well become an incubator for what a world of declining population levels will look like. It's doubtful capitalism is sustainable in such a world. Absolute declines in surplus labor means profit must almost entirely come from technological innovation and the resulting productivity gains. This is a very stiff task.
"The savings rate has crashed from 15pc in 1990 to near 2pc today, half America's rate. Japan's $1.5 trillion state pension fund (the world's biggest) has become a net seller of government bonds this year, as it must to meet pay-out obligations. The demographic crunch has hit. The workforce been contracting since 2005."(1)
1"It is Japan we should be worrying about, not America" UK Telegraph; Evans-Pritchard
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