The Yen and Japan's Economy, 1985-2007

In the late 1980s, Japan’s economy embarked on a period of rapid escalation in the prices of shares and real estate. This “bubble economy” was followed by a collapse in asset prices, a reduced pace of real economic growth, banking problems, and deflation. Nearly two decades after the demise of the bubble economy, the prognosis for Japanese growth remains uncertain amid a turbulent global economic outlook. Japan’s experience carries lessons for those hoping to understand and contain the current financial crisis originating in the United States housing market