Episode summary
Wall Street Week | Investment Opportunities, Corporate Transformation and the Private Capital Boom
Wall Street Week
· · Hosts: Chrystia Freeland, David Westin · Guests: Marc Rowan, Mireya Solis
Summary
Japan is being recast as an investable market after decades of stagnation, deflation, and corporate caution. David Westin frames the shift around rising inflation, changing government policy, and a move from “choraku” — falling behind — toward “henkaku,” or fundamental reform. Marc Rowan argues that 3% inflation, higher rates, and generational change are forcing Japanese households and companies to redeploy cash productively rather than sit in deposits or JGBs.
The episode shows how Tokyo Stock Exchange reforms, higher capital efficiency demands, and more activist ownership are pushing companies to become more accountable. Hiromi Yamaji says the exchange is pressuring firms with low ROE and weak price-to-book ratios, while Mireya Solís argues the “lost decades” label obscures real progress in governance, women’s participation, and labor flexibility. Panasonic Automotive and Sony are presented as examples of companies using carve-outs, portfolio shifts, and patient capital to refocus on higher-return businesses.
Apollo’s pitch is that Japan needs a third financing channel beyond bank debt and public equity: long-dated private capital for manufacturing, energy, AI, infrastructure, and retirement products. The episode ends with Solís saying Prime Minister Takaichi has a strong mandate for growth and industrial policy, but markets will watch closely for discipline given Japan’s large public debt.
Key takeaways
- Marc Rowan says 3% inflation changes the logic of Japanese savings, making cash “the worst assets to own” and pushing capital into higher-return uses.
- Hiromi Yamaji says Tokyo Exchange reforms are working: 5,100 buybacks and 35 trillion yen in 2025 were record highs, while more than half of listed firms still trade below book value.
- Mireya Solís argues Japan’s “lost decades” were not static years, pointing instead to meaningful progress in corporate governance, women’s labor participation, and labor-market flexibility.
- Apollo sees opportunity in long-dated private capital because Japan’s public bond market is small and banks are constrained on longer, more complex financing.
- Sony and Panasonic Automotive are used as examples of portfolio transformation, with both companies shifting toward more focused businesses and longer-term capital partners.
Notable quotes
“-Most people's expectation of Japan or business mindset of Japan is 30 years of stagnation”
“All of a sudden, you have closer to 3% inflation. You have interest rates up for the first time”
“I think Japanese companies has been making a huge investment into automation or digitalization, AI usage”
“-There is a real corporate revolution going on”
“The capital coming off the sidelines from households is looking for better rates of return now that they are facing 3% inflation”
How the episode opens
David Westin: This is Wall "Street Week. I'm David Westin bringing you stories of capitalism. This time, capitalism Japanese style.
This is an ancient land with the imperial dynasty stretching back over a thousand years. Apollo Global Management invited us along as it convened a meeting of its 200 partners from around the world to see firsthand the investment opportunities it sees in Japan today, a world that has not traditionally been associated with risk. We're going to talk with Marc Rowan, the head of Apollo, as well as the leaders of Sony, Panasonic Automotive, and the Tokyo Stock Exchange.
But we start with the story of "choraku". That's a Japanese term meaning falling behind. In 1980s, Japanese industry was the envy of the world in a variety of sectors, such as automotive, electronics, and steel.
As a result, asset values went up, particularly here in Tokyo, where real estate values went sky high, supported by patient capital that did not demand a lot of returns. The 1990s, though, saw that asset bubble burst. And when the Japanese government and Japanese banks did not step in aggressively, they took what was a lost decade and turned it into a lost 3 decades.
-Most people's expectation of Japan or business mindset of Japan is 30 years of stagnation. -I think, you know, we call the lost ages during decades, and we do not have substantial growth in Japan. -Japan faced deflation for a very, very long time.
-Japan has been, you know, suffering from deflation for more than two decades. Westin: In the late 80s, Japan's economy grew by as much as 6.7% a year, only to have that growth plummet for most of the next 30 years, hovering between 0 and 2% and contracting during the great financial crisis and the COVID pandemic, relegating what had been the third largest economy in the world to number 4, as Germany surged past.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- japan economy
- corporate transformation
- private capital boom
- business culture reform
- tokyo female leadership
Companies and tickers mentioned
- APO
- Apollo Global Management
Watch the episode
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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Wall Street Week, this episode and its artwork belong to Bloomberg. Octagon is not affiliated with the show; this page is an independent summary.
