The Nikkei 225 lost more than half its value during Japan’s crash that began in 1990.
Japan’s asset-price bubble formed during the late 1980s, when land and share prices rose to extraordinary levels amid easy credit and optimistic expectations. The Nikkei 225 reached an all-time closing high of 38,915.87 on December 29, 1989. It then began a prolonged decline as monetary policy tightened and the bubble burst.
By August 1992, the index had fallen below 15,000, losing more than half its value from the 1989 peak. Falling land prices weakened banks and borrowers, while nonperforming loans constrained credit and investment. The resulting stagnation became associated with Japan’s “Lost Decades.”
The Nikkei 225 is Japan’s best-known stock index, but the TOPIX is another major benchmark covering a broader set of companies. The crash was part of a wider asset-price collapse involving both equities and real estate, not merely a one-day stock-market event.