The appreciation of the yen leads to the decline of domestic prices, and the economy of the whole country is driven by domestic demand. The prosperity of the financial industry has also caused more enterprises to abandon their main business and turn to speculation, and the wages of ordinary employees have also soared. Some economists in Japan and even the world have said that the traditional economic theory is not applicable to Japan, and Japan is creating "new economic laws".
So, the Japanese bought Rockefeller Tower, the symbol of American financial empire, Columbia Film Company, the symbol of American movies, the forest in Canada, the iron mine in Australia, the most expensive house in Hong Kong, Japanese women bought 70% LV handbags made in France, and Japanese men flew to Thailand in droves to play golf. ...
At that time, Japanese real estate was even more arrogant, and a land price in Tokyo could buy one and a half of the United States. A 9 million apartment can be sold at a high price of 65.438+65 billion yen in the bubble era. 1986 After the Hiroshima Agreement was signed, the average house price in Tokyo soared by 120% and reached the peak of the property market in 199 1 year, reaching an average of 2.72 million yen per square meter, while that in downtown Tokyo was as high as14.5 million.
Later, everyone couldn't afford to buy a house, which was unbearable. So people began to protest, hoping that the government would raise interest rates and introduce property tax to suppress housing prices. Just as the government also thinks that the economy is overheated, the house price is too high, the money for land sales is not its own, and the money for real estate tax is properly its own, so it follows the public opinion to levy property tax and raise interest rates.
Raising interest rates and property taxes are the most effective killers to suppress housing prices, and each effect is very good. With the combination of two swords, Japanese house prices collapsed directly. By 1992, the Japanese economy could not function normally. The steepest drop in house prices is 199 1 year, with a drop of 20%-30%.
With the endless decline in house prices and no hope in sight, real estate speculators began to sell in large quantities, and the house became cheaper and cheaper in a vicious circle. Although houses are getting cheaper and cheaper, the poor still can't afford them. Because no one can survive the early warning of the economic storm, a large number of enterprises have closed down, the working class bears the brunt, and the unemployment rate has soared. A large number of Japanese people are trapped in the property market and work for banks to pay their debts all their lives.
Extended data:
After the bubble burst, many Japanese residents became tens of millions of "losers", and their family assets shrank sharply, bearing a serious economic burden for a long time, which seriously affected normal consumption for a long time. The bad debts of Japanese banks and non-bank institutions reached as high as 100 trillion yen, and finally turned into several trillion yen.
Japanese house prices began to dive from 199 1, and did not start to pick up until 2002. At the lowest point of 200 1, the average house price in Tokyo has dropped from 2.72 million per square meter (1.5 million RMB) to 6 1 10,000 per square meter (30,000 RMB). The collapse of house prices will affect the whole economy, and as a result, enterprises will close down and everything will be ruined.
References:
Baidu encyclopedia-property market crash