Cheap is the new chic in a country where consumers until recently thought nothing of splashing out 10,000 yen (HK$840) at a department store on a single gift-wrapped melon. Falling consumption coupled with rising unemployment - which soared at the fastest rate in 44 years to 4.4 per cent in December - has put a halt to Japan's ostentatious spending habits. Shoppers are deserting the high-class stores and boutiques for the discount outlets and household goods stores where everything costs a mere 100 yen. The upmarket Ginza district of Tokyo may look busy, retailers say, but the public is only window-shopping, not opening their wallets. But that is not the case a kilometre or so away, where business is booming in the old, black-market area of Ameya Yokocho - Ameyoko to locals. Department stores sales shrank 9.4 per cent in traditionally busy December and the government was sufficiently concerned to pass laws late last month providing 2 billion yen in loans to new shops and restaurants. But in Ameyoko, beneath the railway tracks of Ueno district, traders can hardly keep up with demand. 'Ameyoko has this image of everything being very cheap and the place in Tokyo where you can find anything that you want,' said Tadao Futatsugi, head of the local traders' association. 'Because of the state of the economy, we have seen a lot more people looking for bargains. Ameyoko spreads through a warren of alleys. Shops with fronts no wider than their proprietors' outstretched arms are selling crabs and dried squid, next to stalls of cowboy hats, imitation designer bags, rice cakes, golf clubs, jewellery and electrical appliances. A man in a suit is practising his golf swing in a street packed with pedestrians. Men and women in the white aprons of fishmongers call out to passers-by and point to the thick legs of spider crabs caught off northern Japan and sitting in polystyrene trays of ice. Restaurants that are little more than counters serve bowls of cheap but filling noodles or takoyaki octopus dumplings. Parlours for the popular pinball gambling game pachinko are noisy and smoky. Drinking is done standing up. The other key difference here is that shoppers can haggle - something that is unheard of elsewhere in Japan. 'In a store it's just a price on an item, but here it's all about person-to-person sales,' said Mr Futatsugi, an entrepreneur who runs sweet shops, a golf store, coffee shop and a small supermarket in the district. 'You never pay the price that they're asking; you have to knock them down. That's how prices get to be 30 per cent cheaper than department stores.' Yet not everyone in the district is benefiting from the downturn. Takezo Tetzuka runs the Kyokin Bar on the second floor of a building overlooking a busy corner. He is the 13th generation of his family to operate a business in the district and can remember when business was really booming, 25 years ago. 'We used to fall asleep counting the money back then,' he says. 'We had a fish shop and we were so busy that we didn't have time to go to the till after each sale so we used to just put the cash in the top of our long rubber boots and tip it all out at the end of the day. But things have changed since then. 'Yes, I think there have been a lot more people here this year, but it does not seem to me that they're spending as much money as they used to,' he adds. There are 431 tiny shops packed into Ameyoko, which takes its name from both the Japanese word for sweets, ame and the first three letters of American. In its earliest days, peasants bringing their vegetables and rice crops into Ueno station from the north of Japan would fill up their bags and baskets with candy and sell it for five times the price back home. Ameyoko had its first heyday in the difficult years after the second world war, when items begged, borrowed or pilfered from US military bases would find their way here. Ray-Ban sunglasses, razors and soap were popular. Vats of stew left over in the American military camps found their way here and sold for 10 yen a bowl. The Korean war was another time of prosperity for the traders, although Mr Futatsugi is quick to point out that the market is not a den of thieves. 'These things were not stolen,' he said. 'They may not have been taxed or they may have been smuggled in from overseas, but nothing here was stolen.' Now it is experiencing its second heyday, he believes. In the last five days of December, some 1.87 million people did their shopping in Ameyoko, up from 1.66 million last year and 1.29 million 10 years ago. Many are tourists from China and South Korea who have heard of the bargains. But it is one of the very few remaining markets in Tokyo, as big businesses have moved in and developed similar sites that used to operate alongside the stations in Shinjuku, Shimbashi and Ikebukuro. 'All the others have gone,' Mr Futatsugi said. 'We are the only ones now who have originality and uniqueness.' The local shrine - devoted to the god of commerce, among others - was besieged by an estimated 20 per cent more people over the New Year's holidays than a year ago. Undoubtedly, many of the traders who make their livelihoods here prayed for a prosperous year ahead. And there is indeed optimism that these people will fare better than the stores with sky-high overheads and staff costs. 'I have felt a lot of movement in the past six months or so,' Mr Futatsugi said. 'I grew up here and followed my father around ... and it's just the same really, thanks to its deep roots. It's just good to see the place so prosperous again.'