Odaily Planet Daily News: Fed Governor Waller said that the balance sheet should continue to shrink, including adjusting the asset structure to increase the proportion of short-term assets, but there may be no need to cut excessively. "I think it is very likely that we will continue to allow securities that mature and are prepaid to naturally exit the balance sheet for some time to come, thereby reducing reserve balances," Waller said in a speech prepared for the Dallas Fed event on Thursday. In his speech focusing on the balance sheet, Waller advocated shrinking the balance sheet, but the magnitude should be smaller than that suggested by some Fed watchers and economists. He suggested that bank reserves are still at an "ample" level (higher than the "adequate" standard set by the Fed), and the ideal size should be maintained at about $2.7 trillion. If the Fed's currency in circulation and the balance of the Treasury's general account are added, the total balance sheet size will reach $5.8 trillion, while the current size is $6.7 trillion.
