Analysis of the Reasons for the Excessive Expansion of the Financial Industry——Taking Japan as an Example

Qijia Zhang
2021 Advances in Economics, Business and Management Research   unpublished
This paper focuses on the analysis of the causes of Japan's bubble economy in the late 20th century, starting from the huge trade gap between the United States and Japan. This famous Black Swan was caused by The rapid development of Japan's economy, as well as the skyrocketing yen exchange rate caused by the Plaza Agreement signed by the United States and Japan to ease the trade gap. In the end, the Bank of Japan began to cut interest rates sharply to ease the export difficulties faced by
more » ... se companies due to the exchange rate, which eventually led to the over-expansion of the housing market and the stock market and the bubble economy. By analyzing the Case of Japan, this paper explores how excessively loose monetary policy and Expansionary fiscal policy can step by step affect and even drag down a huge economy.
doi:10.2991/assehr.k.211209.294 fatcat:pm5jyxvsfvfilkmgyytwknchpe