Japan experienced the 1989 crash that ended its late-1980s asset-price bubble.
Japanese share and land prices rose dramatically during the second half of the 1980s. The Nikkei 225 reached its historical peak of 38,957.44 on December 29, 1989. After the bubble burst, equity and property prices fell for years, damaging banks, companies, and household balance sheets.
The downturn became associated with Japan’s “Lost Decade,” although economic weakness extended beyond the 1990s. Banks held troubled loans, businesses reduced investment, and deflation complicated efforts to restore growth. The Bank of Japan’s policy response and the timing of financial reforms remain important subjects in economic history.
Japan’s episode was not simply a stock-market event: land prices and credit expansion were central to the bubble. It is also distinct from the 1997 Asian financial crisis, which began elsewhere and affected Japan through regional and banking channels.