For example, has the Bank of Japan been reluctant to engage in bolder monetization strategy in part because of differences in policy priorities and tensions with the Ministry of Finance? The Bank of Japan seems to believe that operations in longer-term government bonds reduce the incentive of the government to move toward fiscal consolidation.
A stable macroeconomic environment - low and stable inflation, sustained growth and low interest rates can generate excessive optimism about the future economic prospects and often the risks are downplayed. Accordingly, episodes of financial instability often have their origins in environment of macroeconomic stability.