Darrell Duffie on the Fed's Balance Sheet and the Changing Financial System

Darrell Duffie on the Fed's Balance Sheet and the Changing Financial System

Darrell Duffie is the Adams Distinguished Professor of Management, Emeritus, and Professor of Finance, Emeritus, at the Stanford Graduate School of Business. He joins the program to discuss the challenges of shrinking the Federal Reserve's balance sheet, the future of payment-system design, the implications of tokenized finance, and much more.

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Check out the transcript for this week's episode, now with links.

Recorded on September 18th, 2026

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Timestamps
00:00:26 - Intro
00:00:48 - Historical Context of Balance Sheet Discussions
00:04:49 - QT vs QE
00:14:44 - Fedwire
00:26:35 - Other Options to Shrink the Fed's Balance Sheet
00:32:14 - Tweaks to the Operating System
00:48:21 - Tokenized Finance
00:53:39 - Duffie's Recommendations
00:58:04 - Outro

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