Since the 1980s, Japan's trade with the United States has experienced a large surplus every year. Electronic products such as TV, walkman, stereo and various motorized machine tools are exported abroad to earn high income. Under the pressure of the United States and European countries, the yen appreciated sharply in the late 1980s and rose by 50% in a short time.
After the sharp appreciation of the yen, the value of the yen increased and its purchasing power became very strong .. All imported goods became very cheap .. The whole of Japan seemed to feel that it could afford everything .. Real estate also rose rapidly .. {in the late 1980s} The whole Japanese society was full of confidence in economic and industrial exports. At this time, many enterprises and individuals began to invest their funds in real estate ... if the funds are insufficient, just like bank loans ... even many enterprises. In order to expand their base. ..
Around 1990, some experts in the real estate industry predicted that the value of the whole Japanese real estate could actually buy the value of four and a half American real estate ...: since 1990, Japanese real estate has reached its peak ... house prices can't go up any more ... but many enterprises and individuals have borrowed a lot of money from banks. ..
Due to the sharp appreciation of the yen in the past few years, Japan's export quotation has become very expensive and has no competitive advantage. Exports have begun to decline significantly. Many enterprises can't make money and can't afford the interest on bank loans when they can't receive orders in the export market. At this time, the problem began to appear, and the chain effect occurred. ..
Because there are too many enterprises that owe money to the bank ... the real estate price has gone up ... The bank has to auction those properties ... The auction price is not as good as expected ... The bank has suffered huge losses ... In many cases ... Banks with poor credit control and management ... even have the crisis of bankruptcy ... When the news is reported ... This will cause panic .. Those who owe a lot of loans to the bank ... are afraid. ..
I've made it as simple as possible. I hope you can understand the meaning. ..