Japanese asset price bubble

Part of a series on the
History of Japan
Tokyo skyline
Periods Paleolithic before 14,000 BC Jōmon 14,000–1000 BC Yayoi 1000 BC – 300 AD Kofun 300–538 AD Asuka 538–710 Nara 710–794 Heian Former Nine Years' War Later Three-Year War Genpei War 794–1185 Kamakura Jōkyū War Mongol invasions Genkō War Kenmu Restoration 1185–1333 Muromachi Nanboku-chō period Sengoku period 1336–1573 Azuchi–Momoyama Nanban trade Imjin War Battle of Sekigahara 1573–1603 Edo (Tokugawa) Tokugawa shogunate Invasion of Ryukyu Siege of Osaka Sakoku Perry Expedition Convention of Kanagawa Bakumatsu Meiji Restoration Boshin War 1603–1868 Meiji Ryūkyū Disposition Invasion of Taiwan (1874) Satsuma Rebellion First Sino-Japanese War Treaty of Shimonoseki Triple Intervention Invasion of Taiwan (1895) Colonization of Taiwan Boxer Rebellion Russo-Japanese War Treaty of Portsmouth Japan–Korea Treaty Colonization of Korea 1868–1912 Taishō World War I Intervention in Siberia Great Kantō earthquake 1912–1926 Shōwa Militarism Financial crisis Nanking incident Mukden Incident Invasion of Manchuria May 15 incident February 26 incident Anti-Comintern Pact Tripartite Pact Second Sino-Japanese War World War II Attack on Pearl Harbor Pacific War Atomic bombings Soviet–Japanese War Surrender of Japan Occupation of Japan Postwar Japan Anpo protests Economic miracle Asset price bubble 1926–1989 Heisei Lost Decades Great Hanshin earthquake Cool Japan Tōhoku earthquake Imperial transition 1989–2019 Reiwa COVID-19 pandemic Abe assassination Noto earthquake 2019–present
Topics Capital punishment Currency Earthquakes Economy Era names Education Empire Foreign relations Geography Historiography Religion Buddhism Christianity Islam Judaism Shinto Military Naval Politics Post-war Science and technology Sports World Heritage Sites
Glossary History Timeline
v t e

The Japanese asset price bubble (バブル景気, baburu keiki, lit. 'bubble economy') was an economic bubble in Japan from 1986 to 1991 in which real estate and stock market prices were greatly inflated.^[1] In early 1992, this price bubble burst and Japan's economy stagnated. The bubble was characterized by rapid acceleration of asset prices and overheated economic activity, as well as an uncontrolled money supply and credit expansion.^[2] More specifically, over-confidence and speculation regarding asset and stock prices were closely associated with excessive monetary easing policy at the time.^[3] Through the creation of economic policies that cultivated the marketability of assets, eased the access to credit, and encouraged speculation, the Japanese government started a prolonged and exacerbated Japanese asset price bubble.^[4]

By August 1990, the Nikkei stock index had plummeted to half its peak by the time of the fifth monetary tightening by the Bank of Japan (BOJ).^[2] By late 1991, other asset prices began to fall. Even though asset prices had visibly collapsed by early 1992,^[2] the economy's decline continued for more than a decade. This decline resulted in a huge accumulation of non-performing assets loans (NPL), causing difficulties for many financial institutions. The bursting of the Japanese asset price bubble contributed to what many call the Lost Decade.^[5] Japan's average nationwide land prices finally began to increase year-over-year in 2018, with a 0.1% rise over 2017 price levels.^[6]