Which Japanese asset-price bubble burst at the start of the 1990s, leading to the Lost Decades?

The Japanese asset price bubble burst at the start of the 1990s, leading to the Lost Decades.

Japan experienced extraordinary increases in land and equity prices during the second half of the 1980s. Easy credit, financial liberalization, optimistic expectations, and strong corporate investment helped push valuations far above levels supported by ordinary earnings and rents.

The Nikkei 225 reached its historical peak of 38,957.44 on December 29, 1989. Asset prices then fell sharply, damaging banks and companies whose balance sheets depended on inflated collateral values. Japan entered a prolonged period of weak growth, deflationary pressure, and financial-sector restructuring.

The phrase Lost Decades commonly refers to the long economic stagnation that followed, although the exact period covered varies among writers. The bubble's collapse was not a single trading-day crash; it was a drawn-out unwinding of property and stock-market excesses.