DALLAS, Oct 3 (Reuters) - When the time comes for the Federal Reserve to reduce its massive balance sheet, one of the big worries is the potential volatility and instability that paring those assets could bring to financial markets, a top Fed official said on Thursday.
"When you are on the buy side things look great," Dallas Fed President Richard Fisher said at a conference on uncertainty at the regional Fed bank. "When you are on the sell side, when we get to that point, things look different."
The Fed's bond-buying program has swollen the central bank's balance sheet to more than $3.5 trillion. Fisher, who has opposed the bond-buying, said that he and his colleagues feel "angst" at size of the balance sheet and the potential challenges when it comes time for the Fed to reduce it.