San Francisco Federal Reserve Bank President John Williams on Saturday reiterated his view that the U.S. central bank should begin trimming its massive balance sheet later this year, in part so the Fed has more tools at the ready when the next recession hits.
He was the fourth Fed official in two days to suggest the Fed may need to restart its controversial bond-buying program to help boost the economy in a future downturn.
The program, also used by central banks in Europe and Japan, was deeply unpopular among U.S. lawmakers especially in the majority Republican Party who said it encourages reckless government spending and does not work. Fed Chair Janet Yellen has been a big supporter of so-called quantitative easing.
At least two of the potential candidates to succeed her when her terms ends early next year – former Fed governor Kevin Warsh and Stanford University economist John Taylor