The premise of Bagehot’s rule is that the counterparty financial institutions are solvent so that they can submit good-quality collateral. Since this was not the case, it was all the more difficult for the Bank of Japan to decide the proper course.
The purpose of these measures was to help alleviate tensions in financial markets and to lower long-term interest rates, thus supporting the real economy and avoiding a deflationary downward spiral. In addition, supervisory authorities have tightened regulatory standards in order to avoid a repeat of the crisis in the future.