6  BIS Review 94/2009  In Japan, the "adverse feedback loop" was not grasped as a dire issue for some time after the bubble burst in the early 1990s. However, the financial strength of financial institutions was gradually undermined during this period, and there was a sudden intensification of an adverse feedback loop in the latter half of the 1990s.
Belatedly at that point, public funds were injected into financial institutions for the first time. The first injection, however, was not sufficient to dampen the "adverse feedback loop," and a number of additional measures and years were required thereafter for the financial intermediation function and economic conditions to recover fully.