Japan experienced the 1989 collapse known as the bursting of the Japanese asset-price bubble.
The bubble developed during the second half of the 1980s, when Japanese shares and urban land became dramatically more expensive. Banks supplied abundant credit, companies invested heavily, and investors expected prices to continue rising. Tokyo land and equity valuations became famous worldwide for their extraordinary levels.
The Nikkei 225 reached its all-time closing peak in December 1989. After monetary policy tightened, share and property prices reversed direction. Japanese banks accumulated nonperforming loans, companies reduced investment, and households faced falling asset values.
The consequences were prolonged rather than a single day of panic. Economic growth weakened, deflationary pressure emerged, and the banking system required years of restructuring. Although the collapse is often summarized as a stock-market crash, property prices were central to the episode. Japan's experience later influenced debates about financial regulation, bank capitalization, and the dangers of prolonged credit-fueled speculation.