The period from 1986 to 1991 is referred to as the Japanese financial bubble. During this time, the value of securities and real estate skyrocketed, especially in major cities. At the peak, the aggregate value of Japanese land was estimated to be four times higher than that of the United States, despite Japan’s territory being 26 times smaller.
Considering that half of the value of Japanese land was attributed to the capital, it can be said that the USA at that time was worth only half of Tokyo.
The astronomical rise in land prices during the Japanese bubble era had significant implications for the country’s economy. It fueled excessive speculation and investment, leading to inflated asset values and unsustainable growth.
When the bubble burst in the early 1990s, it resulted in a prolonged period of economic stagnation known as the “Lost Decade.” The aftermath of the bubble’s collapse serves as a cautionary tale about the dangers of speculative bubbles and the importance of prudent economic management.