This outcome was, in effect, the price of the largest banks not being subject to a direct structural solution such as breakup. None of this is to say that the Dodd-Frank Act got the mix of restrictions just right.
The Bank will have this greater latitude only insofar as inflation expectations are more firmly anchored by the targets and are not dislodged by a delay in responding to a shock.19 Inflation targets have also turned out to be helpful in dealing with certain types of supply shocks.