Core Viewpoint - The reluctance of the Federal Reserve to restart Term Open Market Operations (TOMOs) is hindering further reduction of its balance sheet, a stance based on misunderstanding [1] Group 1: Federal Reserve's Operations - The Federal Reserve cannot achieve meaningful balance sheet reduction without conducting regular open market operations [1] - To effectively reduce the balance sheet, the Federal Reserve must raise money market rates slightly above the Interest on Reserve Balances (IORB) to incentivize banks to shift funds from reserves to other liquid assets [1]