What was the name of Japan’s speculative boom whose collapse caused a long stock-market and property downturn beginning in 1990?

Japan’s speculative boom whose collapse caused a long stock-market and property downturn beginning in 1990 was the Japanese asset price bubble.

During the second half of the 1980s, exceptionally high land and share prices were supported by abundant credit, optimistic expectations, and financial deregulation. Property values in major cities reached extraordinary levels, while the Nikkei 225 climbed to its record closing high of 38,915.87 on December 29, 1989.

The Bank of Japan raised interest rates and credit conditions tightened. Asset prices then fell sharply: the Nikkei lost much of its value, and commercial land prices continued declining for years. Weak banks, bad loans, deflation, and cautious corporate investment prolonged the economic consequences.

The term “Lost Decades” is commonly used for the subsequent period of stagnation, although Japan’s experience included several different phases. The bubble was not limited to stocks; property speculation was equally central to the crisis.