Copyright Robert Cole 2015 - No copying or distributing

The Japanese Market SAKOKU

SAKOKU, "Chain the Land" is the term used to describe the Closed Door policy of isolation instituted throughout the 250 year, TOKUGAWA SHOGUNATE that ended in 1868.

During the years following WWII, The Japanese economy rose with the industry and concentrated effort of its people. The values of swords have never changed for the Japanese, who have always held a profound reverence for their history and the lives and possessions of those that went before. This arises from a deep cultural pride and respect for themselves as a group.

"The group" is included in self-idenity for the Japanese to a far greater degree than is commonly found outside their island nation. The Japanese have pride for the Japanese and the Japan of the Japanese. This is so, and has always been so, because of their long history of structured culture and existence in close, group living.

This, of course, has a play in the functioning of the world sword market.

There are two sword markets, the Japanese sword market and the world sword market.

The Japanese sword market: Japanese buyers remain in Japan. They buy in Japan and carry forth their lives there.

The Japanese dealers are few. They were faced, in the beginning, following WWII, with a world where their Japanese clients were paying Japanese market price for the artifacts of their beloved and revered history, while few in the world outside Japan had the remotest understanding that swords were anything but a garden brush-cutter.

As it happened, auction to auction, year to year, the Japanese dealers found little reason to expose the gapping value difference between the outside world and the sword world at home. Doing their clients the dis-favor of injuriously disrupting their sword market, a market of real property, by communicating the cheap prices and equal disrespect paid the Japanese sword by the outside world would only cause outsiders to raise prices - hurting everyone.

So year after year, they would come to the auctions and bid pittance, allowing the local sword-club members to think that those were what international prices currently were.

Japanese Market SAKOKU

This shows a basic difference in the common thought process. An American or European would not think to engage in a coordinated buying scheme at the expense of clear profit-taking.

The small group of Japanese dealers, on the other hand, watched good and fine pieces being transferred from one collector to another, they themselves always passing on buying, even though they could have made a great deal of money with each individual piece. This is a point not well understood outside the Japanese sword trading community. It would seem difficult to understand how an individual in business can pass up a clear and simple opportunity to engage upon a transaction that will be profitable and is wholly a normal and primary function of his business activities.

As difficult as it sounds for an outsider, such coordinated action flows easily from the Japanese culture. Constant attention by changing managers was the success secret and normality, seen in the long line of changing governments throughout Japanese history. The HOJO, of 13th century KAMAKURA, carried control through the balance of relationships of their puppet, twin governments of Sovereign and SHOGUN by constant attention from individual mangers.

It has been said that Japan changes in name and face only, but her people and cultural structure remain the same. Some methods of operation and character seem in no way dissimilar from organizations and governence of the past.

Coordinated control of these foreign sword acquisitions, since the war, were held together, in many cases, only by the commonality of the comparitively rigorous Japanese social fabric.

No one would question the accepted order of an obviously successful and instituted path of business.

The Japanese sword dealing community engaged their coordinated refrain from foreign purchasing and attained the constant goal of crushing and holding down the outside sword market. Not buying manipulated the buying habits and very consciousness of the outside buying and selling public. Swords that would be passionately seized, and held forever, were shrugged off by the less knowledgeable without a second thought, and so, became available and available at very low prices.

The Japanese dealers were well making money with the fewer pieces taken. The outside world was, for them, a huge vault, holding these pieces until they were desired by a particular Japanese client. Most important, the pieces left in this artificially depressed world sword market, would always be available at an artificially low price. They were the carefully managed substance and equity of these dealer's stable and non-inflating world plan of Japanese sword supply. The direct fruit was a stable wholesale supply.

A few foreign dealers took part in this, what amounts to, conspiracy, as well. They found it acceptable and established. You can't buck the system.

It should be remembered that the sword dealing coommunity is a licensed and close-knit fraternity in Japan. The dealers work together and against the back-ground of a common and groomed social order. All that happens is known by the group. There is a hierarchy and dealers must behave within common acceptable norms.

The business of KANTEI, appraisal papers and sales operate within these social structures. Misbehavior could result in loss of license and shunning. As a result, refraining from excessive purchase was the unquestioned and stunningly successful campaign.

This unusual scheme worked beautifully to keep the market properly high, not flooded, and the world supply well ordered.

Japanese dealers did not run around and lie. For the most part, they didn't need to. The fact that prices were higher in Japan was common knowledge. The average outsider would say they knew of the higher prices but would continue interacting in the same manner as always. Simply: people don't like change. They don't want to hear the world is complex, more complex than their own particular habits. They heard and saw that prices were higher and kept selling their pieces for pennies. Who would tell them not to?

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