The argument this series makes, in 16 steps. It is the same spine every module is built on, and no module states more of it than its own share.
Share and land prices in Japan fell for years after their peaks: an IMF share index lost 72% between December 1989 and April 2003, and land for shops and offices in the six major cities was about 80% below its September 1990 peak by 1999.
The Bank of Japan kept raising its discount rate until August 1990, when it reached 6%, then cut it step by step to 0.5% by September 1995.
Banks had lent against land and counted shares in their capital, so the falls left bad loans and thinner capital; the first direct use of taxpayers' money against financial instability, ¥685 billion in 1995-96 for failed housing-loan companies (jusen), met strong public resentment.
Between August 1992 and September 1995 the government announced six spending packages whose headline totals sum to about ¥63 trillion, and the budget deficit widened and public debt began to climb.
On 1 April 1997 the government raised the consumption tax from 3% to 5% as the budget tightened to steady public finances, the IMF said, before demographic pressures; it traced the downturn to weaker household spending, banking worries, the tighter budget and the Asian crisis.
In November 1997 the brokers Sanyo Securities and Yamaichi Securities and Hokkaido Takushoku Bank, the first city bank to close during the crisis, failed within weeks, and the extra interest Japanese banks paid to borrow abroad, the 'Japan premium', rose sharply.
In 1998 the economy shrank by 1.8% and unemployment reached a post-war record of 4.3% in June; the annual average rose from 4.1% in 1998 to 5.4% in 2002.
In October 1998 Japan's parliament, the Diet, doubled the public funds available for banks from ¥30 trillion to ¥60 trillion and let the state take over failing banks; the Long-Term Credit Bank was nationalised that month and Nippon Credit Bank in December.
In March 1999 the state put ¥7.5 trillion of public capital into 15 major banks, and the Japan premium began to fall.
From 1999 to 2005 consumer prices fell or held flat each year, falling most in 2002, by 0.9%, while prices across the whole economy, measured by the GDP deflator, fell every year and by more.
On 12 February 1999 the Bank of Japan began pushing its overnight rate as low as possible and in April promised to keep it there until deflationary concern was dispelled; in August 2000 it judged that point reached and ended the policy.
In March 2001 the Bank switched its target to the current-account balances banks held with it, about ¥5 trillion at first and ¥30-35 trillion by January 2004, and promised to keep this policy until consumer price inflation excluding fresh food was stably zero or above.
In October 2002 the Financial Services Agency, the banking regulator, set a target of halving the major banks' bad-loan ratio by March 2005; the ratio fell from 8.4% in March 2002 to 5.2% in March 2004 and 4.7% by September 2004.
Growth picked up from 2003, share prices rose from the April 2003 low, unemployment fell from its 2002 peak, and in March 2006 the Bank of Japan ended quantitative easing.
Over the period general government gross debt rose from 55% of GDP in 1990 to 153% in 2005, on IMF data published in 2026.
Why the slump lasted is argued: Bank of Japan economists cite working off bubble-era excesses in capital, labour and debt; Federal Reserve staff, policy that should have eased faster; a BIS paper, slow recognition of bad loans and loans kept simply to keep borrowers alive.