Trader's Glossary

Lost Decade

Lost decades occur after severe economic crises, particularly after an economic bubble has burst. Sluggish economic growth, high unemployment and falling real-estate prices are typical in these situations.Standards of living, if they ever return to pre-crisis levels, take many years to be recovered. The 1980’s are considered a lost decade for Latin America (La DécadaPerdida) after its debt levels spiralled out of control. Japan’s lost decade occurred in the 1990s as a result of a massive asset bubble bursting. The 2000s are considered the lost decade of the United States, owing to the dot-com bubble bursting in the late 1990s followed by the sub-prime mortgage crisis in the latter half of the decade.