$3.5 Billion POMO Closes, All Of It Used To Repurchase 3 Year Auctioned Off 20 Days Ago
The monetization continues: today's $3.5 billion POMO was practically all used to repurchase CUSIP LM0, a 3 Year Note auctioned off by the treasury a whopping 20 days ago: this one. Recall that the auction had $16 billion of Primary Dealers interest accepted. Not a bad way for PD's to offload 21% of their allocation in less than three weeks. Any questions why there was $81 billion in PD bids tendered? The answer: see chart below.
PS: the $30 million LH1 straw man also repurchased: a 3 Year auctioned off on August 11, 2009.
The good news: there is only $7.3 billion left in QE dry powder for USTs: two more POMOs and then the seemingly never ending liquidity-based lubrication of equities is over.