Learn › Economic history › Japan's Lost Decade — 1989 to 2006
Economic history · The world economy
1989 to 2006. After their peaks around 1990, Japan's share and land prices fell for years and its banks were left with loans that would not be repaid. Rate cuts and spending packages, the 1997 tax rise and bank failures, public money for the banks, falling prices, zero interest rates and quantitative easing, the cut in bad loans, and why the slump lasted so long.
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1 Japan's Lost Decade, 1990 to 2006 Share and land prices fell for years, banks failed, prices fell, and the state tried one remedy after another. 7 steps · 10 min Done 2 Falling Land Prices and Japan's Bad Loans Why did loans backed by land go bad, and what happened when public money was first used for failed lenders? 7 steps · 10 min Done 3 Japan's Rate Cuts and Spending, 1990 to 1995 Interest rates came down step by step and six spending packages followed, while the budget deficit widened. 7 steps · 10 min Done 4 The 1997 Tax Rise and Japan's Bank Failures A tax rise in April, a crisis next door in Asia, and three large financial firms failing within weeks in November. 7 steps · 10 min Done 5 Japan's Recession and Bank Rescue, 1998 to 1999 Output fell, unemployment reached a post-war record, and the state took over two large banks. 7 steps · 10 min Done 6 Falling Prices in Japan, 1999 to 2005 Cheaper goods sound like good news, but falling prices made old debts weigh more. 7 steps · 10 min Done 7 Japan's Zero Rates and Quantitative Easing First an interest rate pushed as low as it would go, then a target for the money banks kept at the central bank. 7 steps · 10 min Done 8 Japan's Clean-Up and Recovery, 2002 to 2006 A regulator's deadline for the big banks, a recovery, and a public debt far higher than when the slump began. 7 steps · 10 min Done 9 Why Japan's Slump Lasted So Long Bubble-era debts, policy that eased too slowly, or bad loans left on the books: the argument is still going on. 7 steps · 10 min DoneCountry data from the World Bank (CC BY 4.0) and the UNDP Human Development Report (CC BY 3.0 IGO)
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