James Bullard, president of the Federal Reserve Bank of St. Louis, said the Federal Reserve System is likely to resurrect its controversial discussion on 'how and when' to make a clean exit from the Fed's expansionary monetary policies by the end of this year. The monetary tools in the Fed's toolbox so far have included a willingness to keep the federal funds rate close to zero and quantitative easing, a policy that allowed the Fed to buy up Treasury securities late last year and in the first six months of 2011. "The process of normalizing policy, even once it begins, will still leave unprecedented policy accommodation on the table," Bullard said while speaking to the 19th European Banking and Financial Forum in Prague on Tuesday. "The FOMC may not be willing or able to wait until all global uncertainties are resolved to begin normalizing policy." Factors that could stall a return to normal monetary policies include turmoil in the Middle East and Africa, troubles in Japan from natural disasters, a possible shutdown of the federal government and continued uncertainty over the European sovereign debt crisis, Bullard said. But either way, Bullard believes at some point, the Fed will need to discuss it's escape from QE2 -- a Fed program that allowed the system to purchase $75 billion Treasury securities per month through the first half of 2011. "Exit strategy was widely discussed in 2010, and that debate will likely revive during 2011," Bullard added. In terms of how the Fed will make its return to a normal policy state, Bullard said that will eventually involve a raising of rates and a return to a smaller Fed balance sheet. Write to Kerri Panchuk.