On Friday, December 29th, 1989, the Nikkei 225 stock index hit an all-time high of 38,957.  It then began to fall and it took until February 22nd of this year, more than a third of a century later, to reach this level again.  Today, for the first time, it closed above 40,000.

This ultra-long bear market in Japanese stocks was accompanied by the collapse of a colossal property bubble and was followed by decades of economic stagnation, rising government debt and periodic deflation.  While Japan still faces many challenges today, there are signs that it is turning a corner from both an economic and financial perspective.  However, decades of Japanese economic and financial malaise provide some powerful lessons for Japan itself and for governments, monetary authorities and investors around the world.