In ideal, “Best” (rule based) policy is always anytime optimum.
You never implement such a “best” policy in real world, so you should change policy if things will be better.
Sometimes, policy maker could not understand above simple logic.
“I am perfect. I am doing best policy, so I do not change policy”
“I do not admit that the first policy choice was wrong, so I continue to “correct” policy”
Japanese bureaucrats have the best stubbornness in the world.
The “bubble” burst to the 15 years deflation happened like that.
Today’s BoJ have the same problem, to some-extent. They decided increasing rate of the monetary base at first. It seems falling short of the target today. They could not have peg the market inflation expectation to the 2%.
The perfectionism should be immediate adjustment of the policy. (Read the very first two sentences.)
However, they are waiting. “We did it. Just adjust by your-self, market.”
Yes. The wrong stubborn- being inerrancy- problem actually makes things bad here.
But, this time is different. (Different from 20 years or 5 years ago)
They have the 2% inflation target. If they could not achieve the target, they are wrong. (This is only one score reference for them)
So they certainly will adjust and change policy to the target (with delay), because they do not want to be obviously wrong.
This post is written for clarifying my idea.
Maybe it is different from the truth, to some extent.
PS I have done a comment regarding this issue here http://www.themoneyillusion.com/?p=23337