, investment opportunities will increase and the natural rate of interest will rise. as an unconventional monetary policy that contributes to strengthening growth potential, the bank has established a facility called the “ loan support program. ” the facility is composed of two measures. one is the fund provision for economic growth, which provides funds for financial institutions ’ loans and investment that contribute to japan ’ s economic growth. the second is the fund provision to stimulate lending, which provides long - term funds at low interest rates for financial institutions ’ incremental lending, in order to support their efforts to increase lending. the facility aims to promote financial institutions ’ initiatives toward finding demand for funds in high - growth firms and business fields. i would like to add one point here ; namely, that maintaining the natural rate of interest at a high level is also important as a means of increasing the resilience of the economy against various shocks. in that regard, when the natural rate of interest increases sufficiently, the possibility that the policy rate will hit the zero lower bound again declines and the resilience of japan's economy is likely to increase. iii. unconventional monetary policy and global financial markets lastly, as already discussed in this symposium, let me touch on issues that relate to global liquidity and cross - border capital flows. given the wide spectrum of important issues within this set of topics, let me focus on two such issues – taking into account my own experience – as shown in chart 9. unconventional monetary policy and cross - border capital flows first, the relationship between unconventional monetary policy and cross - border capital flows is quite complicated. while this is not new to central banks and related parties, almost all base money provided through monetary policy will be accumulated in the form of deposits with a central bank. even if a country eases monetary conditions, this does not necessarily mean that money being provided directly “ spills over overseas. ” starting from such accumulated base money and changes in demand - supply conditions in asset markets in which the bank conducts purchase operation, the issue is with regard to how financial market participants ’ expectations and transactions will change and how that will affect cross - border capital flows. this process is fairly complicated, and monetary easing does not necessarily lead to crossborder capital outflows. for example, if growth expectations heighten due to monetary easing, there might be capital inflows in search of a high natural rate of interest. importance of international coordination among central banks second, i would like to point out that – also in international

that can be expressed in various ways : reducing the debt overhang ; establishing more sustainable levels of leverage ; re - absorbing excess liquidity ; and restructuring and strengthening the balance sheets of banks, households, firms, governments and central banks. just as we showed courage in facing the pressing demands of the crisis itself, now policymakers must be equally courageous in dealing with these longer - term threats to stability and growth. that is the topic of my remarks today. i will briefly review the origins and extent of the imbalances that have accumulated over the past three decades. i will then examine the trichet ( 2009 ). implications of the need to deal with these imbalances for today ’ s macroeconomic policymakers. finally, i shall reflect more broadly on the challenges for central bankers in periods characterised by elevated uncertainty and the need for preventive action. it is in this context that i will discuss the relationship between the standard and non - standard measures of monetary policy - making. this is more than a mere technical matter. it goes to the very heart of our role in uncertain times. deeply, our decisions on such measures are a reflection of our fundamental conviction and fundamental responsibility. i. debt accumulation in advanced economies the current debt problems in advanced economies did not start yesterday. they have had a long gestation over the past few decades, originating in the financial deregulation and innovation of the 1980s and 1990s. in many advanced countries, new financial products and institutions emerged, which changed the economic behaviour and balance sheet structure of the private sector. on the one hand, financial innovation promised to be welfare - enhancing for society : some consumers could smooth their spending over time more easily ; and access to mortgage financing became much more widely available, including to segments of the population previously excluded from the market. 2 the benefits of deregulation and innovation appeared particularly pronounced in the exceptionally benign pre - crisis macroeconomic environment, which became known as the “ great moderation ”. on the other hand, and with the benefit of hindsight, we can say that the great moderation was the calm before the storm. the easier access to finance permitted by financial innovation was also leading to higher leverage in the private sector, especially in financial institutions, to a seemingly inexorable increase in house prices, and to a surge in risk - taking. rajan ’ s ( 2010 ) analysis of the “ fault lines ” in our economies reveals some of the deeper drivers of excessive credit growth, in particular as a way