Despite this secular increase in the outstanding amount of government bonds, the Japanese government has been able to raise funds at low interest rates without difficulties. This fact seems to have dulled the sense of crisis in Japan and led to procrastination in addressing the problem.
Demand for government bonds in Japan has been sustained by the accumulation of surplus funds at financial institutions, partly reflecting efforts by firms to strengthen their balance sheets and reduce borrowing amid low economic growth since the bursting of the bubble in the early 1990s.