December 29, 1989: The Nikkei, Japan's main stock exchange, hits an all-time high: 38,915.87. It marks the peak of what had become known as "Japan, Inc."
The Nikkei, an abbreviation of The Nihon Keizai Shimbun, is the flagship publication of Nikkei, Inc. and the world's largest financial newspaper. The Nikkei 225, a stock market index for the Tokyo Stock Exchange, has been calculated by the newspaper since 1950.
For the 1st 30 or so years after World War II, "Made in Japan" was a byword for "cheap" and "poorly made." Japanese companies got the hint, and made things better, and the company became a giant in electronics and automotive services. Brands like Sony and Toyota had become the biggest in the world in their respective fields.
South Korea fought to keep up with their regional rivals, and succeeded in some areas. So did British-controlled Hong Kong, off the coast of China, home to the next-biggest stock market in Asia. This led to the American cities of Los Angeles, San Francisco and Seattle stepping up their game: The term "Pacific Rim" no longer referred to just a danger zone for earthquakes, but to technological innovation.
The joke was turned back on America: Not only were American companies competing by cutting costs, by skimping on quality control, but Japanese companies began buying American real estate, including skyscrapers in major cities. A recession struck America in 1990, and the country seemed to be falling behind Japan, which looked strong enough to be recession-proof. In his "Carnac the Magnificent" sketch on The Tonight Show, in which he "divined the answers without ever having seen the questions," Johnny Carson came up with this gem:
A: Tokyo, Los Angeles, New York.
Q: Name the three largest Japanese cities.
On January 8, 1992, during a State dinner honoring Japan's Prime Minister Kiichi Miyazawa, President George H.W. Bush -- who was running for re-election during a recession, and really did not need for this to happen -- contracted food poisoning, and threw up on Miyazawa.
This led to the TV show Saturday Night Live parodying the American political show The McLaughlin Group, which often had over-the-top analysis of current events and predictions that started out silly and got sillier as they were proven untrue. (They had already parodied it a few times, and real-life host John McLaughlin had joined them the preceding October.)
In The Arakawa Group, a sketch that was too racist to be allowed to air today, the moderator, played by Mike Myers, asked his 4 panelists -- like him Japanese people being played by white American actors -- things like, "Who is more lazy, American worker or... " And the answers would be in broken English. And when the end of the show/sketch came, the moderator asked for predictions. One panelist said, "Within five years, all Americans addicted to crack!"
What most Americans didn't know was that the bubble had already burst: Japan was not recession-proof, the Nikkei went down in 1990, and, by mid-1992, it had lost 60 percent of its end-of-1989 value. The fall of the Japanese economy was every bit as remarkable as its rise. The 1990s became known as "Japan's Lost Decade," and it took them nearly 20 years to fully recover.
UPDATE: It took until February 22, 2024 for the Nikkei to exceed the 1989 peak: 39,098.68.
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December 29, 1989 was a Friday. Actress Jane Levy was born.
There was 1 college football bowl game on this day. Number 18 Penn State beat Number 19 Brigham Young University (BYU), 50-39, in the Holiday Bowl at Jack Murphy Stadium in San Diego.
There were 8 games played in the NBA:
* The Milwaukee Bucks beat the Detroit Pistons, 99-85 at The Palace in the Detroit suburb of Auburn Hills, Michigan.
* The Indiana Pacers beat the Houston Rockets, 103-97 at the Market Square Arena in Indianapolis.
* The Chicago Bulls beat the San Antonio Spurs, 101-97 at the Chicago Stadium. Michael Jordan scored 34 points.
* The Phoenix Suns beat the Minnesota Timberwolves, 118-101 at the Metrodome in Minneapolis.
* The Portland Trail Blazers beat the Dallas Mavericks, 144-140 in triple overtime at the Reunion Arena in Dallas. Derek Harper scored 42 points.
* The Los Angeles Lakers beat the Golden State Warriors, 130-111 at The Forum outside Los Angeles in Inglewood, California. James Worthy scored 34 points.
* The Sacramento Kings beat the Philadelphia 76ers, 105-95 at the ARCO Arena in Sacramento. Danny Ainge scored 33 points for the Kings.
* And the Boston Celtics beat the Seattle SuperSonics, 96-89 at the Seattle Center Coliseum.
There were 5 games in the NHL:
* The New Jersey Devils beat their arch-rivals, the New York Rangers, 3-2 at the Brendan Byrne Arena at the Meadowlands. Sylvain Turgeon scored the winning goal with 9:06 left in regulation. You might laugh that I mentioned the winning goal, but, at the time, this was 1 of the Top 10 moments in Devils history.
* The Washington Capitals beat the Detroit Red Wings, 2-1 at the Capital Centre in the Washington suburb of Landover, Maryland.
* The Boston Bruins beat the Buffalo Sabres, 4-3 at the Buffalo Memorial Auditorium. Craig Janney scored the winning goal with 3:27 left in overtime.
* The Winnipeg Jets beat the Calgary Flames, 2-1 at the Saddledome in Calgary. Tomas Steen scored the winning goal with 2:11 left in overtime.
* And the Edmonton Oilers beat the Montreal Canadiens, 6-2 at the Northlands Coliseum in Edmonton.
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