The consequences of the bursting of Japan's property market bubble What can be used to remedy the bursting of Japan's property market bubble?

Japan's property market is also developing well. Now many people with good economic conditions want to immigrate to Japan, but do you know the consequences of the bursting of the Japanese property market bubble? If this happens, how can we remedy it? Share with you today the consequences of the bursting of the Japanese property market bubble? How to remedy the bursting of Japanese real estate bubble? Let's refer to it together, hoping to bring you help.

The consequences of the bursting of Japan's real estate market bubble

The bursting of Japan's real estate bubble also hit the Japanese economy hard. Although the output value of Japan's real estate accounts for only about 13% of GDP, the bursting of the real estate bubble has brought losses to enterprises and banks, as well as a negative impact on consumer spending, which still restricts the development of Japan's economy and still has the problem of insufficient domestic demand. According to the statistics of Cabinet Office of Japan, the average annual growth rate of nominal and real GDP (1990-2003 yen) is 1.39% and 1.66% respectively, and the GDP contraction index is negative 0.25%. From fiscal year 1992 to fiscal year 2003, the average annual growth rate of disposable income and expenditure of Japanese working class was -0.53% and -0.55% respectively.

In 1970s and 1980s, the bursting of the real estate bubble in major western industrial countries (such as Britain, Australia, Denmark and Norway) led to the decline of house prices by 27.3% and 28.5% (from peak to trough), which lasted for 19 and 16 quarters respectively. The bursting of the stock market bubble in the major industrial countries in 1970s and 1980s caused the stock prices to fall by 49.5% and 47.6% respectively, which lasted for 10 quarter.

Moreover, before the bursting of the real estate price bubble, private consumption and private construction investment accounted for 6 1.5% and 10.4% of GDP respectively, but after the bursting, they accounted for 36.5% and -32.7% of GDP respectively, and the average GDP growth rate before and after the bursting of the real estate bubble was 3.4% and 0.8% respectively. The bursting of the stock market bubble has less impact on the economy than the bursting of the real estate bubble. Before and after the bursting of the stock market bubble, private consumption declined only slightly, from 57.4% to 55.2%, private fixed investment in construction industry from 7.7% to 1.4%, and the average annual growth rate of GDP dropped from 4% to 2.6%.

What is the remedy after the bursting of the housing bubble in Japan?

In the late 1980s, Japan's real estate bubble was very serious.

Because of decades of rapid economic growth, Japanese housing prices are also drifting with the wind. If the data of 1955 is taken as the base of 100, the land price index of business districts in six major cities, such as Tokyo, Osaka and Nagoya, will exceed 10000 in 1965 and 10000 in 1988. Especially after the Plaza Agreement of 1985, the appreciation of the yen made the real estate price in Japan reach an incredible height. It is estimated that in 1990, the total land value of Japan reached 15 trillion US dollars, four times the total land assets of the United States and more than five times the GDP of that year. There used to be a joke that Japanese real estate assets could buy the whole United States. This shows the severity of Japan's real estate bubble.

Under this circumstance, the Japanese government took the initiative to ensure the healthy development of the real economy and had to detonate the real estate bubble. Twenty years have passed and there has been no improvement so far. But no Japanese speculate on houses any more.

After the real estate bubble burst, Japan's economy suffered a heavy blow. The Japanese government has also taken some measures to remedy it, the main core of which is to further strengthen the development of the real industry. For the real estate market, some public rental housing measures have been introduced to solve the housing problems of bankrupt, industrial and low-income groups. In terms of finance, it is mainly through procrastination, that is, exchanging time for space, so that a large number of bad debts of banks can be gradually offset by the development of the real economy. On the other hand, by issuing government bonds, we have invested heavily in public enterprises to meet the actual demand. By amending the banking law, the Bank of Japan has an independent monetary policy, zero interest rate or even negative interest rate, increasing the liquidity of the Bank of Japan and so on.

But these measures are just a drop in the bucket. Because Japan's infrastructure has been highly improved, the construction of public utilities still cannot drive private investment and consumption.

Because after the bursting of the real estate bubble, all the big banks and financial companies in Japan have been severely hit, but the strength of big banks is still very strong and they can bear bad debts, and some financial enterprises with insufficient strength have gone bankrupt. Not to mention small and medium-sized financial enterprises, including Hyogo Bank, Pacific Bank, hokkaido takushoku bank, the tenth largest bank, and Toyo Credit Vault. Jin Mu credit portfolio, the largest credit portfolio in Japan, closed down; Financial giants such as 13 1 securities, one of the four major securities companies, cannot survive. Moreover, a large number of enterprises went bankrupt, the domestic unemployment rate also rose sharply, the income of residents dropped sharply, and the consumption level continued to decline.

Ten crises, nine real estates. The bursting of the real estate bubble is a very serious matter, not as simple as falling house prices. It is related to the operation of the entire economic system.

The above knowledge about the consequences of the bursting of the Japanese property market bubble and what to remedy after the bursting of the Japanese property market bubble is worth taking as a sample to avoid repeating the same mistakes. Be careful when choosing materials. If you still want to know the relevant knowledge, you can continue to pay attention to our website.