Core Viewpoint - Federal Reserve Governor Waller supports the reduction of the balance sheet size and the adjustment of asset structure to increase the proportion of short-term assets, suggesting that excessive cuts may not be necessary [1] Group 1: Balance Sheet Reduction - Waller advocates for the continued natural exit of securities from the balance sheet through maturity and early repayment, which would reduce reserve balances [1] - The proposed reduction in the balance sheet should be less aggressive than some observers and economists have suggested [1] Group 2: Current Reserve Levels - Waller indicates that bank reserves are currently at a "plentiful" level, exceeding the Federal Reserve's "adequate" standard [1] - The ideal reserve level should be maintained at approximately $2.7 trillion, with total balance sheet assets reaching $5.8 trillion when including currency in circulation and the Treasury General Account [1] - The current total balance sheet size is $6.7 trillion [1]