A police officer guarding the Federal Reserve building in Washington, DC: the challenge in unwinding current policies is not technical. As Fed chairman Ben Bernanke explained in February 2010, exit from quantitative easing and bloated central bank balance sheets is technically straightforward. Photograph: Andrew Harrer/Bloomberg

Since the beginning of May, monetary policy has undergone a substantial tightening. This has taken the form of a rise in the yield on the bonds of hig(...)