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“Japan’s policy makers generally procrastinated considerably in terms of implementing any kind of stimulative measures, as well as prematurely reversing the benign impact of policies which had some earlier success. In terms of monetary policy, the BOJ did not actually embrace quantitative monetary easing until 2001, eleven years after their bubble had burst. Furthermore, the authorities waited until 1998, a full 8 years after the real estate crash, before embarking on a program of banking recapitalization, the upshot being that the traditional mechanisms through which credit was to be intermediated were still severely impaired. The benign impact of fiscal reflation was also undermined by a wrong-headed increase in the consumption tax in 1995, which was followed on by the Asian financial crisis, creating an additional exogenous shock to an economy still recovering from the throes of a major credit bubble collapse.” source...