Farmers That Finance the World

Plus: Inflation Accounting, Stress Tests, GameStop

Last time I was in Japan was the year before Covid. Together with my family, I travelled across the country by train, zig-zagging from Tokyo into the Kamikochi National Park (“the Japanese Alps”) before heading down to Kyoto and the south. I’d been to Tokyo several times before for business meetings, but this was the first time I’d ventured out into the country. 

As we rushed past fields and forests, my family marvelling at the speed of the trains and the tidiness of our bento-boxed lunches, I stared out the window, looking at something else. There’s no mention of it in the guide books, but the farms we passed play a central role in the global financial system. They are the source of a massive pool of savings that gets deployed right around the world. Japanese real estate, US subprime, private equity buyouts – all markets that have been financed from this pool. And sitting on top of it, commanding those flows, is a single financial institution: Norinchukin Bank. 

This is the story of No…