The fact that banks are once again able to raise capital is a very positive sign for US markets, however asset quality issues must still be addressed and more losses are on the horizon. As such, the timing of exits from stimulus programs by the government and US Treasury is essential, and market participants around the world – particularly those in the securitization and structured finance spaces - are watching closely as policymakers start to look at winding down support programs, selling off assets and re-evaluating fiscal and monetary policies.

How and when programs are closed and assets sold are of critical concern both to issuers and investors as it could have a big impact on tenuous market stability. With Fed officials arguing at the Federal Open Market Committee meeting in late January over when to start selling off some of the assets making up their $2.26 trillion balance sheet, that impact could be tested sooner than anyone thought likely.

Clearly no one expects the Fed to flood the market with a sudden rush of sales and any program will likely extend over a number of years, but that timing is critical. And while Fed Chairman Ben Bernanke said in his congressional testimony on February 10 that he did not expect asset sales in the near term, according to the minutes of the Open Market meeting in January, a number of Fed officials felt that asset sales should begin in the near future. Such disparity is just a bit unnerving.