Which 1989–1990 collapse of Japanese asset prices began Japan’s prolonged economic stagnation?

The 1989–1990 collapse of Japanese asset prices was the Japanese asset price bubble’s bursting.

During the late 1980s, Japanese land and share prices rose dramatically amid abundant credit, optimistic expectations, and financial deregulation. The Nikkei 225 reached its peak of 38,957.44 on 29 December 1989. Japanese authorities then tightened monetary policy, and asset prices fell sharply.

The property and stock-market collapse damaged banks, companies, and household balance sheets. Japan’s economy subsequently experienced prolonged weak growth, falling prices, and banking problems. This period is often called the “Lost Decades,” although the exact dating and economic interpretation vary.

The bubble is sometimes confused with Japan’s postwar economic miracle, which describes the earlier rapid-growth period rather than the later collapse. It is also distinct from the Asian financial crisis of 1997–1998, which affected several regional economies and had different immediate causes.