Regulatory intervention is hampering the recovery of the US securitisation market. Authorities would be better off stepping aside and letting the market fix itself.
The Term Asset-Backed Securities Loan Facility (Talf) is due to expire at the end of March, which might indicate the US securitisation market is now able to stand alone without government support. However, a number of factors continue to impede a real recovery. Although the facility has pushed down coupon rates, credit spreads remain