A fourth key element of the post-crisis regulatory regime is to develop credible options for resolution so that even one of the largest financial firms could be allowed to fail without bringing the financial system down. Without such options, market discipline will remain lacking.
For the euro area, this relationship is empirically well-founded. The available econometric evidence suggests the existence of a stable relationship between M3, the euro area price level and a small  BIS Review 28/2000  2  number of other area-wide macroeconomic variables. Moreover, there is good evidence with regard to leading indicator properties of M3 for future price developments.