A Smooth Exit*

A Smooth Exit*

well prepared
ahead of exit
decision points

we and the markets
asset prices
avoid confusion
preparing tools

tightening cycle
not fully tested
market actors
clearly informed

crucial message
work in tightening
clear intentions
drain drain drain

important statement
unsure timing
increase short-rate
mitigate risk

shrinking balance,
passive manner
gradually shrinking
slowly unwind

*excerpts from a speech by Brian Sack, Executive Vice-President of the New York Federal Reserve, at the National Association for Business Economics Policy Conference in Arlington, Virginia on March 10, 2010.

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