That is, in the aftermath of a crisis in which corporate profits deteriorate, economic uncertainties increase, and the funding environment worsens, business fixed investment will be constrained excessively, and firms' continuing cautious stance will lead to prolonged stagnation in capital accumulation. Let us look at the past business fixed investment stance of firms in Japan (Chart 11).
Following the bursting of the bubble economy, they remained reluctant to make fixed investment for a long period under prolonged deflation. However, as I mentioned at this meeting last year, firms surely had become more active with their fixed investment in recent years, mainly on the back of high levels of profits.