From the perspective of a Wall Street analyst or portfolio manager, interpret the following hypothetical statements:

• "The Fed's future monetary policy will depend on economic indicators reported."
• "The Fed's role is to remove the punch bowl just as the party comes alive."
• "Inflation is likely to rise because real short-term interest rates are currently negative."

Explain how the Federal Reserve affects monetary policy, including its influence on interest rates and stock prices. Identify important factors of the Fed's monetary policy, describing the tools the Fed uses.