But going beyond such general comments, I believe the following reasons can be given for this constraint. 4  With regard to the appropriateness of the phrase, “lost decade”, see Shirakawa (2009). 5  See Box1.1 “Could Deflation become a Global Problem?”, IMF (2003). 6  Federal Reserve Bank of Kansas City (2003).
4  BIS Review 55/2010  First, confidence in the effectiveness of private sector self-regulation or the disciplinary mechanisms built into financial markets may have been too strong. The continued benign conditions of the macro economy also had an effect. In the “Wealth of Nations”, Adam Smith emphasized the benefits of free competition.