• Fed perhaps doesn’t have the right monetary tools to address the systemic problems
• Frustrated with ineffectiveness of monetary easing
• US Govt has to reduce market uncertainty and needs to show more determination in tackling the budget deficit
• Sees US growth at 2.5-3% in 2012 barring further shocks
• No need to worry about inflation in the short term, but Fed must preserve its strong inflation- fighting reputation
• Monetary policy no substitute for budget policy