Nikkei 225 · April 2, 1990
The Japanese Bubble Bursts
-6.60%
single-day change vs previous close
Part of a longer stretch
The bubble's first leg down
midway through · 1989-12-29 → 1990-10-01, -48.04% over the whole period
What happened that day?
- 2 April 1990 — Nikkei 225 fell 6.6%, four months after its record high in December 1989
- During the bubble, Japanese share and land prices pushed each other up
- Rising land values were used as collateral to borrow and buy shares; rising share prices raised company values, which bought more land
- When the Bank of Japan raised rates, the loop reversed
- Falling collateral forces loans to be called; calling them forces asset sales; those sales push prices down again
- Fell 28.04% from peak. But only the beginning — Japanese equities wouldn't regain that peak for more than twenty years
Sources
Every figure on this page is recomputed from the original daily closing prices and checked against them at build time. The account of what happened is written from the sources listed above.