Although a sound monetary policy, in isolation, cannot always altogether prevent the emergence of inflationary trends, it can make it very difficult for inflationary trends to persist. On the other hand, monetary policy can do virtually nothing to counter structural unemployment, such as mainly prevails today in many countries. For example, it can neither enhance labour-market flexibility nor widen an unduly narrow wage-rate spread.
After all, we live in a market economy and creative  BIS central bankers’ speeches  1  destruction is a central element. Individual banks must be able to fail like any other enterprise. This must also hold for large banks which are often labelled “too big to fail”. To allow them to fail without destabilising the entire system we need resolution mechanisms.