Many Japanese spent Sunday floating lanterns down rivers, honouring the souls of the departed. A similarly timeworn tradition was played out in Tokyo yesterday as the cabinet office revealed gross domestic product numbers that failed to meet expectations. The eclipse of Japan as the world’s second-largest economy is a sideshow. The more telling statistic is that its nominal output has retreated to levels last seen way back in 1993. Unlike other rich economies wrestling with deflationary forces and minimal growth, though, Japan has largely come to terms with its decline. The big banks make no secret of their desire to build assets overseas rather than at home, where deposit growth consistently outpaces demand for credit. No chief executive is being fired for preferring the payment of huge takeover premiums for growth outside Japan over domestic investment. When it comes to disappointing domestic growth, investors have seen it all before. Equities barely budged on the news, while 10-year government bond yields sank further below 1 per cent. There will be calls for remedial action from the Bank of Japan, although it has no low-risk way to ease monetary policy much further. Yet few will be pushing for truly radical economic reforms. After all, the country is the world’s third most peaceful, according to the Institute for Economics and Peace; its Misery Index ranking – inflation plus unemployment – is less than half the big-economy average. Radical moves such as relaxing immigration controls remain off the agenda: last year Japan’s population of foreigners fell for the first time in 48 years. Yesterday’s numbers – and the markets’ shrugs of indifference – showed that the country is quite happily trading growth for harmony.