The government's tentative assessment that the current spell of economic expansion is likely to have continued for 57 months since December 2012 — and has tied the second-longest postwar boom from 1965 to 1970 in duration — may be misleading. The picture of the economy today is in stark contrast to what was happening in the late 1960s, when Japan was still in the midst of the postwar rapid growth period. It seems almost irrelevant to compare the duration of economic booms that took place at such different times. Equating the current spell of expansion to the 1960s boom should not lead to an overly optimistic judgment of the economy.
Among the several extended economic booms that the nation experienced in its post-World War II history, none may be more unlike the so-called Izanagi boom between November 1965 and July 1970 than the ongoing expansion under the watch of Prime Minister Shinzo Abe with his trademark Abenomics policies. Named after a deity in Japanese mythology, the 1965-1970 boom was marked by robust demand for consumer durables such as cars, air conditioners and color televisions. The economy grew at a double-digit annual rate in many of the years during the expansion.
In the current boom, the real-term growth in Japan's gross domestic product reached 2.6 percent in fiscal 2013, but the economy shrank 0.5 percent the following year due to the protracted slump in personal consumption following the April 2014 hike in the consumption tax from 5 percent to 8 percent — although the Cabinet Office did not recognize that as a recession that interrupted the economy's upward trend. GDP growth remained slow in subsequent years — rising 1.2 percent for both fiscal 2015 and 2016. The average growth is also much slower than during the 51-month, asset-inflated bubble boom of the late 1980s to the early '90s — the third-longest postwar boom — when the economy grew by around 5 percent annually.