– What happened in Japan in late 1980s that NIKKEI has still not recovered from the fall?

Question

– What happened in Japan in late 1980s that NIKKEI has still not recovered from the fall?

In: 4

Answer 1

It’s more “What made the NIKKEI become so overvalued in the 1980s”.

In the late 80s the NIKKEI was a pure bubble economy with overheated economics and really easy credit, investment was rampant with the expectation that tomorrow would see even better returns. It was a house of cards.

When it crashed people’s confidence in investing in Japan evaporated, by the time the markets stabilised and international investment could be seen other Asian markets were now attractive too.

Simply put the NIKKEI probably won’t see that valuation again as it’s value then wasn’t rooted in reality.