The Rise and Fall of Japan's Stock God: From Moderation to the Greed Trap

Did you know? Japan’s stock market legend is Kawa Ginzo, who turned 70 yen into a miraculous fortune of 20 billion yen, only to lose 30 billion in his later years due to “one more greed.” Behind this story lies a lesson that all investors need to learn.

Difficult to Practice: Even the Stock God Fell to Greed

Many people think that investment failures stem from a lack of knowledge. Not so. In the late 1970s, Kawa Ginzo personally demonstrated that the true enemy is human nature itself.

When international non-ferrous metal prices surged and news of the Soviet invasion of Afghanistan spread, Kawa judged that the trend would continue upward and heavily invested. The market was indeed booming, but it was this smooth sailing that led him into a deadly trap—he rarely lost his composure, refused to cash out at high levels, and was instead led by greed. The final result was heartbreaking: a floating profit of 30 billion yen was lost, turning into “paper wealth.”

This contrasts sharply with his early investment philosophy.

From Bottom to Peak: How Kawa Ginzo Was Made

The story begins 30 years ago. Having experienced World War I and various businesses, Kawa was almost penniless at 31. It was this despair that prompted him to make a life-changing decision—to turn his fortunes around through knowledge.

He buried himself in the Osaka Library for three years, studying economics books, trying to find the iron laws of investing. In 1931, he entered the market with 70 yen borrowed from his wife. From then on, this poor young man embarked on a legendary investment career.

Kawa’s success came from consistent effort. He collected information daily, communicated with securities firms, and kept a pulse on the market. This daily accumulation laid the foundation for several of his classic battles:

Battle 1: Steel Arbitrage After WWII
After the war, with everything in ruins, Kawa foresaw that people would buy large amounts of iron sheets to build temporary shelters, so he quietly accumulated. As a result, stock prices soared dozens of times, and he made a fortune.

Battle 2: Cement Reversal During the Oil Crisis
In the 1970s, Japan’s economy was hit hard by the oil crisis, and cement stocks fell from over 800 yen to around 100 yen. But Kawa saw through the government’s plan—to use infrastructure policies to counter the crisis. He bought large amounts of Japan Cement Company stock, earning 30 billion yen in three years.

Battle 3: The Legend of the Mitsubishi Mine Gold Mine
In the 1980s, news about high-quality gold veins hidden in the Rokkō Mine attracted Kawa’s attention. He conducted in-depth investigations and was finally convinced it was a treasure. At that time, neither the market nor the mine owner (Sumitomo Metal Mining) realized its true value. Kawa quietly built a position, and in less than two months, the stock price soared to more than nine times his purchase price. He earned another 20 billion yen and ranked first in personal income that year.

The Secret to Escaping the Top: The Wisdom of Eight-Tenths Full

The key question is—why could Kawa perfectly cash out before the crash while most people couldn’t?

The answer lies in his “eight-tenths full” principle.

The case of Sumitomo Metal Mining best illustrates this. When the market was wildly pushing the stock price to the sky and everyone was shouting “it will go higher,” Kawa went against the trend. He quickly sold his holdings and took profits. Three weeks later, the stock plummeted to one-third of his selling price.

Kawa said: “Selling stocks is like eating—only eating to eight-tenths full is the true realm and wisdom.”

The brilliance of this statement is—it exposes the biggest trap in the stock market. Market optimism is like tempting food; it easily causes people to ignore their body’s signals and keep consuming. The result? From enjoyment to harm. Kawa chose to get off the train while the stock price was still rising. He may not have caught the peak, but he avoided the tragedy of going from millionaire to beggar.

Steady and Sure: The Tortoise’s Three Principles

Besides the “eight-tenths full” philosophy, Kawa also created the “Three Principles of the Tortoise,” centered on: Investing is like a tortoise and hare race—slow is fast.

These three principles are:

1. Discover Potential Stocks
Don’t chase hot topics; instead, find companies with huge future prospects that are not yet recognized by the public, and hold them long-term.

2. Do Your Own Research
Monitor economic and market data daily, and insist on analyzing yourself. He never blindly trusts optimistic news from newspapers or magazines because “by the time the news is published, the stock price is usually near its peak.” True opportunities are often hidden in information gaps.

3. Avoid Excessive Optimism
Don’t believe the stock market only goes up; operate only with your own funds, and never use leverage.

These three points seem simple but are difficult for most investors to follow. Because it requires resisting human temptations—temptations to chase gains, to leverage, and to believe “this time is different.”

The Wake-up Call: How Greed Devours 300 Billion

But the story doesn’t end perfectly here. Kawa’s later years serve as a warning.

The loss of 30 billion yen clearly shows that—even with a perfect investment framework, it is very difficult to always maintain self-discipline. In the case of heavily investing in non-ferrous metals, market prosperity made Kawa relax his vigilance. His once-cold and restrained demeanor gradually dissolved under greed. Ultimately, his paper wealth vanished into thin air.

Inspiration: Always Fight Human Nature

The life of Japan’s stock market legend is essentially a repeated validation of the same truth—the key to investment success or failure is not in stock-picking insight, but in managing one’s greed.

Knowledge can be learned, experience can be accumulated, but the hardest thing to control is always the beast called “greed” deep within human nature. Kawa’s legendary and failed lessons boil down to eight words: Invest rationally, exit calmly.

Do you have this measure of wealth and risk firmly in your hands?