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$8.2 Billion POMO Closes: Most Monetized Issue Is 7 Year Bond Auctioned Off Last Week
The Fed-Primary Dealer scam continues in plain view. After today's $8.2 billion POMO closed at a 3.7x Submitted to Accepted ratio (below median ratio - surge in stocks right on schedule), a quick look at the most monetized POMOs confirms that the near-immediate monetization of just auctioned off bonds continues. To wit: as can be seen on the table below, the highlighted CUSIP most monetized is PK0 (as we speculated earlier) to the tune of $1.4 billion or 17.3% of the entire operation. This is the 7 Year bond auctioned off on November 24. That's one week ago. And the market continues to pretend that the Fed does not buy bonds at auction. Why should it: the Fed continues to hand out billions to Primary Dealers courtesy of their transitory intermediation via the bid/ask spread and price-notional differences. Pathetic.

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Bond vigilantes...dudes...you are WAYYYYYYY behind schedule.
Behind? They are ducking for cover! Why short into the maw of the Fed? Remember if the Fed wanted to they could make the 30 year yield at 1%. Sure might be raging hyper inflation but since they print the money they can dictate interest rates if they so choose.
The real vigilante presence would be going into hard assets and dropping Fun Bux.
Bond vigilantes my ass. Not even Charles Bronson or Tony Soprano can stop the Fed. They do what they want.
And Gov Yellen had the audacity to mutter this earlier:
12-01 09:12: Fed's Yellen says long term securities buys "actually quite similar" to the Fed's traditional monetary policy approach
Right.....the Fed's been monetizing one-week old debt for years now, even decades.
Such unbelievable liars these fuckers are!!
The pertinent question, as this has in a sense become old news (for ZHer's): How long until we are called on it, and how?
This is just fucking stupid.
Yep, and suspension of disbelief continues to rule the world.
Ok, here's my question. If it is $7B today, and the treasuries purchased were mostly auctioned last week, how much are the banks really making? They make the price difference from last week to this week. That's not a lot of money is it?
Now if they're buying treasuries that have been sitting on primary dealer balance sheets for a long time, then there could be some bigger money freed up.
Isn't today's case more monetization of debt than freeing up money for primary dealers to juice assets?
Couple million bucks....hey to some people thats a bit of money!
A couple million is not enough to juice commodities and stocks like we have seen. I really want input on this. The end game is literally monetization once the primary dealers are out of any treasuries on their balance sheet.
At that point, we are simply funding the government, and it requires the government spending that money to keep things afloat. I know the end game is bad, but where does it end?
Hard to believe with 17% unemployment, the biggest housing crash in history, people are still buying lawnmowers.
One lesson I learned is to never count out the U.S. consumer.
Consumers?....or Fannie and Freddie and the banks trying to take care of all the shadow inventory.
That's Toro, they also make snow throwers (some of the best imho too). Have you seen the recent effects of global cooling?
A lot of people remember last February in the east and see snowblowers out front of Lowe's/Home Depot.
Robo...I admit I was one of those people.
Bought a lawnmower at the expense of letting my "lawn guy" go...
At some point, primary dealers will only have freshly purchased treasuries to sell to the Fed, which would mean the entirety of the QE operation will be monetizing freshly issued debt, right?
Yes Erik....no just thinly disguised.
POMO role in other asset prices move doesn't matter that much now.
Yes Erik....now just thinly disguised.
POMO role in other asset prices move doesn't matter that much now.
WHERE IS MY GODDAMNED PITCHFORK?
Monetize the US people into total slavery! And theyre oblivious! If it were a plot line to a movie or book, no one would believe it.
POMO money now obviously flowing into Europe, as the Euro just rose 1 cent against the dollar in six minutes.
It just keeps getting more and more perverted as we go.
And turned into precios metal? Nice breakout moving now. Surprised they couldn't dump Platinum today, wonder why.....
Ben should have cut a better deal with the PDs before QE2 kicked off, something along the lines of 'now remember fellas, I'm giving you this money to buy tech, retail and financials, not gold and silver ok? I'm trusting you with this now, so don't screw me over, ok?'
Looks like he missed covering that one.
The day was still young when Brian Sack returned to his personal office, where he was about to have his personal masseuse rub it out for him. He remembered Blackhawk Ben liked him to call after the POMO was done after he had poured himself some whiskey to sip. He took off his shoes and kicked his feet onto his desk.
"Hey Blackhawk."
"Hey Sackman." Ben's voice sounded scratchy and hoarse. "Good....ahem...Good thing gold is down. How did you do it?" Blackhawk Ben looked sheepishly at himself in the mirror. He has jealous that the Sackman was stealing his thunder. Ben had been relegated to working at the Fed laundry mat of late with unemployed "normal people", as Ben called them.
"We have begun leasing gold from Knox to the PDs in exchange for toll house cookies." "Yum!" Sackman took a bite of one. "They're delicious. I will have Erin send you over a box." He looked up and winked at Erin, who was back from her stunt at cnbc. She began to rub his shoulders but he pointed lower down his body.
From behind Ben someone yelled, "Ben get your ass down here, we have to do the whites!" "Coming. Well I have to go Sackman. Good work today. Thank you Ben." "All hail the POMO." "All hail the POMO." Answered Sackman before he hung up his phone. He stretched his arms behind his head and thought to himself that he wanted another cookie. "You know why they call me Sackman Erin?" "No, why?" But she knew. People call him Sackman because he has a huge Sack.
NFLX 204.7 making negative pattern on 30 min, watch yday low of 195.55 for reversal day.
Still in the prediction business after your terrible gold calls?
For your sake hope you are paper trading.
Terrible? Gold has moved up maybe 2% and is still forming a POTENTIAL top below 1400. Above there and it is likely to 1500. Below 1340 and its likely to go to 1200. You guys are so emotional.
Not emotional and not making incorrect price guesses here.
Time will tell, thats for sure.
Black Friday to reward the unwashed masses, POMO to reward the elites. Everybody's happy.
SPX
Great effort, Ben. Now let's see what you've been hiding....
http://99ercharts.blogspot.com/2010/12/spx_01.html
http://www.zerohedge.com/forum/99er-charts
The market is quite the mess.
Interesting that not much is being made of the 10y @ virtually 3%. Cannot be good news to the Bean and his other farts. QE2 was not supposed to go this way....
I haven't seen a POMO schedule lately, does anyone know if every day is now POMO day? Of course I mean an announced POMO day, not the behind the scenes backdoor POMO that the fed is so good at.
Bubbles Ben and Brian Sack have
yet again lost complete control of
the long end of the Treasury curve. Incompetency
at its best.
Can somebody put the article in to plain English for me? I take it that the banks purchased treasuries at auction on the 24th of Nov and now the Fed has purchased them at a sizeable profit for the banks, is this correct?