Both the practice of bank over-lending and massively overpriced land prices in Japan generated one of the biggest asset price bubbles in history, which burst in 1991 starting off a period of economic stagnation known in Japan as the “lost decade”. However the government’s reaction was to implement a series of Keynesian policy controls which prolonged this stagnation into a “lost 20 years”, spending 100 trillion yen on ten fiscal stimulus packages throughout the 90s to no avail. A similar future is possible in China, recent years have seen a relaxation on borrowing restrictions on local governments and an ease on limits on home purchases in big cities, while economist think the Chinese government may use policy to stimulate consumption, include subsidies to boost purchases of cars, home appliances and other large items.
aier.org/article/the-keynesian-trap-lessons-from-the-japanese-slump mises.org/library/explaining-japans-recession danieljmitchell.wordpress.com/2019/07/29/china-and-keynesian-economics-a-strategy-for-stagnation-and-debt