Again, the key idea is that, when a fund’s assets are illiquid, outflows today are met in part with drawdowns from cash reserves, with the other assets being sold off more gradually over time – hence, the predictable downward pressure on prices going forward.
Throughout the 1990s, the BOJ conducted its policy while paying close attention to the condition of the financial markets and the financial system. This was especially true in the late 1990s when the systemic dysfunction of our banking system was apparent.