After the chaos this week in short-term funding markets, the Federal Reserve faces yet another tough task: how to shore up the multitrillion-dollar network that keeps funds flowing through the U.S. financial system without stoking fears of a systemic problem or fueling talk of a recession. Morgan Stanley expects the central bank will turn to rebuilding its balance sheet by announcing permanent open market operations -- known as POMOs -- to support funding markets. These procedures aren’t anything unusual for the central bank, which has long used POMOs to help stabilize reserves, and offset the growth of ... (full story)