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The Curious Case Of Bloomberg's Persistent Treasury "Demand" Disinformation Campaign

Tyler Durden's picture


Less than a month ago, Zero Hedge thoroughly debunked an article written by Bloomberg's Susanne Walker and Wes Goodman, titled "China Adding to $1 Trillion of U.S. Debt Caps Rise in Rates" which had one purpose only: to eliminate public panic arising from the imminent removal of the Fed as a buyer of first and last resort, and attempt to convince naive readers that China is in fact adding to its holdings. To wit: "China, the largest investor in U.S. government debt after the Fed,
increased longer-term notes and bonds by 39 percent to $1.145 trillion
in December from a year earlier."
As we showed previously this statement was based on a completely unfactual apples to oranges comparison of pre and post-revision TIC data, further showing that if the authors had conducted their analysis properly it would have actually shown a decline in China's Treasury holdings in a 12 month period. Then in a development so ironic it would even make Alanis Morisette blush, we disclosed the very next day that Bill Gross dumped all of his Treasury holdings, pending an answer to the question of "who will buy US Treasurys once the Fed stops monetizing", immediately refuting Bloomberg's "all is rosy on the foreign front" argument, reinforcing our thesis that with the Fed gone, foreigners will promptly cease to co-bid alongside the bidder of biggest resort, and in essence ending any artificial attempts to make the US paper demand picture any better. Yet today, less than a month later, Bloomberg's Daniel Kruger, in an article titled "Fed Exit Means No Pain for Obama as Foreigners Buy 60% of Notes at Auction" repeats precisely the same mistakes as his colleagues which we have since corrected, cheery picks some other data, and goes on to present a goalseeked argument to a conclusion that once again appears to have come from "above." Frankly, we are stunned by this persistence to refute Bill Gross' (not to mention Zero Hedge's) factually based view that foreign demand is declining materially for US bonds, and without QE3, it is very possible that it may disappear entirely. So allow us to debunk Bloomberg's second attempt (which we again hope is merely a function of misunderstanding of the subject material) at outright factless spin.

First, Kruger repeats the same mistake as his colleagues Walker and Goodman did less than a month ago, and which we took the time to correct:

Foreign investors owned $4.45 trillion of Treasuries as of January, up from $3.7 trillion a year earlier, according to the government. China, the largest overseas lender to the U.S., held $1.15 trillion of the debt in January, up from $889 billion a year earlier. Japan’s stake grew 16 percent to $885.9 billion.

Since apparently nobody is aware that the TIC data is revised on a periodic basis, we will again present how the data looked like pre-revision. From our previous post:

The farthest back one can possibly go back using the most recent data is June 2010, when the revised data begins. Bloomberg, however, completely ignored this, and based its entire article which somehow was supposed to confirm that foreign investors are not concerned about US inflation, and thus are adding to their holdings in droves, based on apples and oranges data.

What would the data look like if Blomberg had used a data series that is actually apples to apples, so that the December 2009 Chinese holdings of $894.8 billion data point is applicable?

Here is what Treasury data looked like pre-revisions (which includes the June 2009 and prior data as per the revised "Old Series" - luckily Zero Hedge now archives all obsolete, pre-revision government data just for these situations):

is rather apparent is that instead of a surge from $894.8 billion to
$1,160.1 billion, or a 30% increase in Chinese holdings, as incorrect as
it may have been derived, using just the old data series, Chinese
holdings actually declined to $891.6 billion! Of
course, this calculation is also irrelevant as the US Treasury revised
holdings halfway through the year, and therefore neither of these
comparisons are actually relevant any longer.

Hopefully this is merely a trivial mistake, although by now we would think Bloomberg editor Dave Liedtka (who oddly edited both articles yet appears very much inexperienced in dealing with Treasury data) would have at least a rudimentary understanding of TIC data.

Yet where the Kruger article gets into cherrypicking data is what really disappoints us and makes us truly wonder about the objectivity of Bloomberg. Kruger says: "The class of investors that includes foreign central banks
purchased 60 percent of the $66 billion in benchmark 10-year
U.S. notes sold this year, up from 42 percent in 2010
. Fed data
show banks have increased their holdings of Treasuries to the
most since December, as a panel of bond dealers and investors
that advises the government says lenders may double their stake
to $3.2 trillion in 2016." Kruger is correct about the take down of the 10 Year auction, however, he ignores to mention that it is skewed far higher due to the outlier February auction in which Indirects took down a record 71.3%. An in fact in during the QE2 regime (from September 2010 when QE2 was priced in, through March 2010), the 10 Year has averaged a far more modest 53.6% average purchasing rate (take down). And just like in late 2009, early 2010, the foreign take down for the 10 Year is starting to drop precisely on expectations of the end of quantitative easing (not teh plunge from September 2009 to January 2010).

Next, and this is far more grievous, Kruger completely fails to mention that the Indirect take down of all other bond maturities is far lower than the 10 Year as the below chart demonstrates.

Indeed, while foreigners have an interest in the 10 Year, it is more than offset by a lack of interest in the short-end of the curve. Average indirect take downs in 2011 of the 2 Year are 30.4%, of the 3 Year: 33.8%, of the 5 Year: 40.5%, of the 7 Year: 50.4%, and of the 30 Year: 40.7% - confirming that pretty much everywhere across the curve except at the 10 Year position the Fed is the primary buyer. Alas, you will not find this far less than flattering data anywhere in Kruger's analysis.

But where Kruger's analysis falls completely on its face is when looking at Treasury securities held in custody for foreign officials and international accounts, or specifically the place where the bulk of foreign purchases are parked: this is also the best place to get information on weekly foreign demand for US paper, since the Treasury International Capital is not only inaccurate, but comes out with a three month delay. And here is where the data gets really ugly.

Let's cut straight to the chart:

The chart really says it all: in the three months of 2011, foreign demand has been the "flattest" since the start of the financial collapse. Comparing the change in holdings from December 31, 2010 ($2.618 trillion) through March 31, 2011 ($2.637 trillion) shows a negligible increase of just $19.5 billion, or less than $7 billion per month! This pales even in comparison with the same anemic period from last year when this account changed by $54.9 billion. We wonder if Mr. Kruger can explain to us how a $7 billion run rate in UST purchases per month will sustain the $1.5 trillion in annual debt issuance to fund ongoing US deficits.

In addition, Mr. Kruger's analysis also completely ignores that in addition to gross issuance there are things called "redemptions" by the Treasury, or maturing bonds which constitute a cash outflow, an undetermined amount of which goes to Foreign lenders. Alas while it is impossible to break it down by how much Indirects received from the Treasury in maturing debt, we do know that of the $534 billion in gross issuance in 2011, "only" $339 billion was a net cash inflow to the Treasury, or net issuance. In other words $194.8 billion, or 36.5% of total, was redemptions! But this one will also not find mentioned in Mr. Kruger's piece, and this could easily skew the answer and explain why there was any interest in the 10 Year to begin with (or any other maturity).

But all of this really is moot as it only looks at primary market analysis, whereas as we wrote yesterday, the bulk of the action is and has always been in the secondary market, where the Fed monetizes debt on a daily basis via POMO. And here, as Zero Hedge demonstrated yesterday, a whopping 83.4% of net issuance (which is the correct number to look at, not the gross, or not net of maturities) since the start of QE2 has been monetized by the Fed. No if, ands, or buts. And no spin by any mainstream media can change this stone cold fact.

The bottom line is that when one removes the noise, the propaganda, and the misinformation, foreign interest in US Treasurys is dropping, and the Fed is a net buyer of more than every 8 out of 10 bonds issued.

We certainly expect foreign interest to plunge once (if) it is definite that QE3 is not coming. Yet that won't be the end of the world: interest will surely be there.... At a price. We expect that in the absence of QE2, the 10 Year to be fairly priced about 200 bps wide of where it is trading now, somewhere in the 5.50% range. Which, incidentally, will lead to a complete devastation in the US housing market, a plunge in short-end prices, a huge bear flattening in the market, and the next financial system collapse.

But something tells us Mr Kruger won't write about this particular story (nor will his "editor" David Liedtka be asked to edit on it.)

In the meantime, Zero Hedge will be happy to consult with any and all Bloomberg authors on the matter of Treasury issuance, a topic which it seems very few there have much if any experience with.


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Mon, 04/04/2011 - 19:16 | 1134829 JW n FL
JW n FL's picture

No... NO!!! We Export our Treasury Notes!!! Just like we export our inflation!! this cant be true?? My eyes!! My EYES!!!

Mon, 04/04/2011 - 20:29 | 1135078 asdasmos
asdasmos's picture

@TD Great Post

Mon, 04/04/2011 - 20:33 | 1135091 prophet
prophet's picture

jw, good to "see" you and hope you don't mind me jumping in here

Has an e-mail been sent to the reporters explaining the views expressed here and offering them a chance to dig a little deeper and/or respond with their take on the views expressed here?

Mon, 04/04/2011 - 22:11 | 1135214 asdasmos
asdasmos's picture

This is all I could get from Bloomberg, then Bill sold all the bonds soon after. (Read from bottom to top.)


On Tue, Mar 8, 2011 at 3:05 PM, DAVID LYNCH, BLOOMBERG/ NEWSROOM:> wrote:


yup. saw it. about 100 years ago, i used to work for the local paper in gross's area and got up at 4am one morning to spend a day watching him work. he's a very interesting guy.




----- Original Message -----
From: <asdasmos>
At:  3/08 18:03:27


No worries and thank you for taking the time to respond,

I am not so sure that I would take too much from a study from the institution under question, even if it is the almighty Fed. With that in mind, I believe you might be familiar with Bill Gross of PIMCO and would consider him have extensive knowledge in this area.

If you have the time, I would highly recommend his March Investment Outlook here;

*Quick quote from the piece:*
    What I would point out is that Treasury yields are perhaps 150 basis points
    or 1½% too low when viewed on a historical context and when compared with
    expected nominal GDP growth of 5%. This conclusion can be validated with
    numerous examples: (1) 10-year Treasury yields, while volatile, typically
    mimic nominal GDP growth and by that standard are 150 basis points too low,
    (2) real 5-year Treasury interest rates over a century’s time have averaged
    1½% and now rest at a negative 0.15%! (3) Fed funds policy rates for the
    past 40 years have averaged 75 basis points less than nominal GDP and now
    rest at 475 basis points under that historical waterline.

Much Appreciated,



    On Tue, Mar 8, 2011 at 1:59 PM, DAVID LYNCH, BLOOMBERG/ NEWSROOM: <> wrote:


    thanks for your note. sorry it took me a day to respond; i was traveling

    to answer your question, studies (including those done by the New York
    Federal Reserve Bank) indicate that the Fed's asset purchases held down the
    10-yr yield by around 50 basis points during QE1. the current program, QE2,
    is believed to be having a more limited impact because it is roughly
    one-third the size of the original. ballpark estimate from the author of the
    original NYFed study is 15 to 20 basis points.

    so it's a factor, but not an overwhelming one.

    thanks again for taking time to write.





    ----- Original Message -----
    From: <asdasmos>
    At:  3/08  0:13:32

    Hi Mr. Lynch,

    I have a concern relating your article about the bond Market. I have
    attached a graph that you might find helpful with my question.

    *Yes, "The U.S. today is able to borrow at historically low interest
     rates", but is this not because of all the Fed purchases of US debt?

    My main concern is about the recent Fed purchases of treasuries and how
    sustainable it all is. They are now the largest holders of the debt and
    without a QE3 or QE2 continued, I am unsure how these low rates could
    continue. It then begs the questions, 'at what yield will they be
    attractive?' and 'can the US handle higher yields in terms of the economy
    and debt servicing issues?'. (This is aside from the question about the
    absorptive capacity of the world being able absorb all this debt, along
    with additional trillion dollar deficits in perpetuity.)

    *Would it be helpful to take this into account (or even mention this) when
    considering your conclusion in such an article?

    Many Thanks,


    *Article in question:

Tue, 04/05/2011 - 01:21 | 1135782 Selah
Selah's picture



I wonder what name this David Lynch posts under on ZH?


Tue, 04/05/2011 - 18:39 | 1138912 JW n FL
JW n FL's picture


ART! WORK!! God Love Ya! and Protect Ya! Thank You! for Sharing and being a Fantastic Human Being!

Mon, 04/04/2011 - 19:16 | 1134831 homersimpson
homersimpson's picture

*sigh* And people wonder why the newspapers are getting hit hard or going bankrupt...

Tue, 04/05/2011 - 07:34 | 1136004 blindfaith
blindfaith's picture

Homer, it is not just the papers, it all the, TV, and the net too.  All of it has become a spin sewer, and sadly I have to say the even NPR has turned into a carbon copy repeater of (we haven't done our homework either, so we will repeat the spin) station.  I just heard yesterday on NPR , that stuff shirt that hosts "talk of the Nation" that the Chinese 'and other foreign countries' buy all our bonds and "have us over a barrel".  He needs to be on Fox where you know you can get "reliable" information.

NONE of these 'stations' have the funds to PAY real investigators, not when some anchor like Kattie Curic gets 15 million for here face.  Maybe that is what Homer and family really want...a face not facts.

I stopped buying the Wall Street Journal soon after Murdock bought it...the quality became Sally has red hair, so All Sally's must have red hair,  writing.  I heard yesterday that their "Book Reviewer" just wrote that Gandi was Gay (in a new book just out)...the ass never even read the book he was reviewing or he never would have written that.  But then again, it is Rupert Murdock at this best to twist the information to fit the agenda or in-site anger.  All this is my make up your own mind.


ZEROHedge is Just about the only source for quality, real, important, and truthful information.  THANK YOU Tyler, you are keeping my ulcer well feed.

Mon, 04/04/2011 - 19:15 | 1134833 bob_dabolina
bob_dabolina's picture

Quantitative easing is not going to end.

Mon, 04/04/2011 - 19:24 | 1134857 MarketTruth
MarketTruth's picture



#losing... dollar value
(Got physical gold and silver? You'll want to.)

Mon, 04/04/2011 - 20:36 | 1135100 Mr Anderson
Mr Anderson's picture

I'll trade you a side of beef for 5 oz of gold when SHTF. I'll even keep it frozen for you when your power goes out.

I really don't care for the gold but will trade beef for oil.


Mon, 04/04/2011 - 20:20 | 1135049 Cursive
Cursive's picture


Really miss your old avatar, bro.

Mon, 04/04/2011 - 21:06 | 1135198 bob_dabolina
bob_dabolina's picture

I did too, so I changed it back however after serious consideration of using this one:

Tue, 04/05/2011 - 08:06 | 1136065 Absinthe Minded
Absinthe Minded's picture

Sorry about the Junk, I was trying to open the link. I think I just did a blank post too, Goddamn Ipad and the disable rich text bullshit, I don't know where the rage for these friggin'things come from, the only reason I have one is the wife bought it for me on our anniversary. Don't have the heart to tell her I don't like it.

Mon, 04/04/2011 - 19:15 | 1134834 LostWages
LostWages's picture

Yet another media company carrying the water (urine) for the administration.


Mon, 04/04/2011 - 19:24 | 1134855 umop episdn
umop episdn's picture

From the ZH manifesto:

"to skeptically examine and, where necessary, attack the flaccid institution that financial journalism has become."

This is yet more proof that we the want-to-know people need ZeroHedge more than ever. The truth must be known, and I am thankful for those who will teach it.

Mon, 04/04/2011 - 19:46 | 1134932 dearth vader
dearth vader's picture


Mon, 04/04/2011 - 19:16 | 1134836 hambone
hambone's picture

You are trying to preach to the unrepetent.  They are not interested in your "facts" nor likely to convert to your "reality".

Mon, 04/04/2011 - 19:24 | 1134860 JW n FL
JW n FL's picture

The Bimbo's said to the CIA Guy that the Economy is up beat! Green Shoots! Bitchez!!

Not green shoots.. but green light the shoot! becuase fraud ends in FORCE!

GREEN SHOOT! coming to a Town Near You!

Mon, 04/04/2011 - 20:23 | 1134895 hambone
hambone's picture

I think Hulbert's curve is indicating we are approaching or may have already reached "PEAK BULLSHIT".

This will be quickly followed by "PEAK DEEP SHIT" catching the likewise cresting "PEAK DIP SHITS" of America by utter surprise.

Point of order though - The CNN host was correct that the economy is looking up - it is better...the real question would be at what expense?  The return on the investment of $150B monthly in deficits returning a meager 2% to 3% gamed GDP growth.  That's growth of $300 to $400B at the expense of $1.5T invested annually (plus perpetual interest payments on that debt) return in taxable income coming back to the Feds likely $100B on investment of $1.5T.  That is an investment only a governmental could call a "recovery".

We need an official ZH spokesperson to ask these ridiculous "tv personalities" some very simple questions...any nominations???

Mon, 04/04/2011 - 21:29 | 1135280 B9K9
B9K9's picture

You were on the right track on your original post. Facts are merely the "ball" in which to play catch - nothing more, nothing less.

I read with bemused interest the long, long thread regarding the CNN 'interview'. Jeez louise, people, when are you going to finally give up the idea that "facts" in any way, shape or form actually frame the "debate"?

After all this time, I for some reason thought the ZH crowd was finally coming up to speed. Look, in a credit money system, there are credit & currency aggregates. One, the other or both are either expanding and/or contracting. IOW, there at most 4 possible 'states'.

The chosen who established the system by which we operate & live decide both the state & operators at any given time. There are four possible situations; so far we've been through credit expansion/contraction, and curreny expansion. That leaves a fourth option not yet played.

When you have absolutlely everything one could wish for on this temporal plane, the only remaining motivation is the avoidance of boredom. Hence, the game is simply played for the sake of entertainment. If the players have already won during the first 3 stages, which one is remaining, thus 'novel'?

This isn't difficult - the same play book has been used for thousands of years. But for some reason, they throw out a silly diversion (look, someone is pointing out it's all about oil!) and the fish take the bait, hook, line & sinker.

Mon, 04/04/2011 - 22:43 | 1135477 Hulk
Hulk's picture

When you have absolutlely everything one could wish for on this temporal plane, the only remaining motivation is the avoidance of boredom. Hence, the game is simply played for the sake of entertainment. If the players have already won during the first 3 stages, which one is remaining, thus 'novel'?

There it is folks, spelled out in black and white. This is ultimately what we are dealing with. Well done B9K9...very well done...

Tue, 04/05/2011 - 07:44 | 1136026 blindfaith
blindfaith's picture

Neo: I suppose the most obvious question is, how can I trust you?
The Oracle: Bingo. It is a pickle. No doubt about it. The bad news is there's no way if you can really know whether I'm here to help you or not, so it's really up to you. You just have to make up you on damned mind to either accept what I'm going to tell you, or reject it.

Mon, 04/04/2011 - 19:41 | 1134917 EscapeKey
EscapeKey's picture

Oh, but it is. How's this for STRONG JOBS GROWTH, with ENDLESS OPPORTUNITIES?

McDonald's Corp. will hold its first national hiring day April 19 to fill 50,000 openings at its restaurants nationwide. The company, based in Oak Brook, Ill., says it is making a concerted effort to add staff as its business improves and as more of its restaurants stay open 24 hours a day.

McDonald's is hiring restaurant crew and management for full-time and part-time positions. The company's hiring goal translates to between three and four new hires per restaurant.

Turnover slowed in the past few years because of the weak economy, the company says. McDonald's sees this event an opportunity to attract employees in a tough job market.

It is also trying to shed the negative connotation of employment at the fast-food chain, once dubbed "McJobs." About half of its franchisees and more than 75 percent of its managers started as store workers.

"A McJob is one with career growth and endless possibilities," the company said in a statement.

McDonald's held a similar event in its Western region last year. More than 60,000 people applied for the 13,000 positions.

Those who are interested can apply in stores or online. Some restaurants will hold events and interviews that day.

Mon, 04/04/2011 - 20:39 | 1135114 DosZap
DosZap's picture

If you apply for a position, be prepared to fight 50k hispanics for a slot, and you had best be under 25.

The Paki's and Arabs, have the 7-11's.

The other chains are under Nigerian control.

More power to em' as long as their legal, at least they will work for negative wages.

 No Crackers prease.(;

Mon, 04/04/2011 - 20:57 | 1135176 Pegasus Muse
Pegasus Muse's picture

Rob Arnott was on KingWorldNews last weekend.  Very insightful interview.  He spends some time explaining why GDP is a flawed metric -- it's a measure of spending, not a measure of prosperity.

James Turk's interview was superb too:

Mon, 04/04/2011 - 22:39 | 1135470 NidStyles
NidStyles's picture

Amazing how I had spoken to him on just that, two months ago.

Mon, 04/04/2011 - 22:20 | 1135426 Village Idiot
Village Idiot's picture


Mon, 04/04/2011 - 19:18 | 1134839 Forgiven
Forgiven's picture

The music stopped some time ago.  Only the drunkards have not found a chair.

Mon, 04/04/2011 - 19:31 | 1134874 EscapeKey
EscapeKey's picture

Considering Bernanke is continuously spiking the punch bowl, there's quite a few.

Mon, 04/04/2011 - 19:51 | 1134956 dearth vader
dearth vader's picture

The drunk don't bother for a chair, they know their Chair is always there.

Mon, 04/04/2011 - 19:20 | 1134844 LowProfile
LowProfile's picture


Mon, 04/04/2011 - 19:23 | 1134853 camaro68ss
camaro68ss's picture

wow Great Post! this is good for 100+ on the DOW tomorrow maybe.

Mon, 04/04/2011 - 19:24 | 1134854 bullandbearwise
bullandbearwise's picture

Folks, if Bill Gross really did dump all his Treasuries then it stands to reason he is ready to load up again. Just because he sold at one point in time doesn't mean he won't re-marry.

Mon, 04/04/2011 - 19:51 | 1134955 hack3434
hack3434's picture

Your point is moot...of course he will at the right price. 

Mon, 04/04/2011 - 22:43 | 1135476 NidStyles
NidStyles's picture

Probably right before QE2 end's.

Mon, 04/04/2011 - 19:25 | 1134856 Gold 36000
Gold 36000's picture

That's great if China quits buying so many treasury bonds.  I don't see how they can hold their peg if they don't recycle those dollars. 

Gosh darned if they do and gosh darned if they don't.  Those dumb chinese got us right where we want them.

Mon, 04/04/2011 - 19:28 | 1134869 EscapeKey
EscapeKey's picture

China advice their citizens to buy gold and silver. They are quite obviously telling them to prepare for the storm.

Oh, and wasn't there some meeting about dumping the Dollar in Nanqing last w/e, done in such as fashion to take the least hit possible?

 Those dumb chinese got us right where we want them.

China have got the US, right where the US wants them? WTF?

Mon, 04/04/2011 - 20:49 | 1135154 Howard_Beale
Howard_Beale's picture

 Those dumb chinese got us right where we want them.

It was obviously a joke. A good one too.

Mon, 04/04/2011 - 19:25 | 1134859 Robslob
Robslob's picture

So when no one buys treasuries then that means no one really wants dollars either...?

Mon, 04/04/2011 - 22:33 | 1135455 Double down
Double down's picture

Initially it can mean a great demand for dollars, physical ones to place in savings accounts. 

But after that, a great demand for gold

Mon, 04/04/2011 - 19:25 | 1134864 koot
koot's picture

ZH has shown beyond a shadow of doubt proof that the Federal Government of North America is the greatest threat to the United States and for that matter all nations on the Earth.

It is time for people to first realize this and revolt against the tyranny that is the Federal Government and all its functions.  Only through nullification of this Federal Government in all things considered criminal by the States can we know peace, liberty and freedom.

Understand that these same Federal People will if they deem necessary to keep their power use nuclear weapons against the United States.

Mon, 04/04/2011 - 19:34 | 1134889 breezer1
breezer1's picture

or japanese reactors????

Mon, 04/04/2011 - 19:38 | 1134908 bullandbearwise
bullandbearwise's picture

Great idea. Let's start a revolution!

Whoops, no one cares...

Mon, 04/04/2011 - 20:42 | 1135125 Mr Anderson
Mr Anderson's picture

Pretty sure the rest of the world knows how deadly our federal govt is. Considering we are killing Afgans, Iraqis, and the good people of Libya (overtly). Covertly who knows what countries we are messing with.

The world now knows there is nothing more dangerous than America.

Mon, 04/04/2011 - 21:03 | 1135194 TemporalFlashback
TemporalFlashback's picture

Average Americans have yet to come to this conclusion. They let their television do the thinking.

Mon, 04/04/2011 - 22:06 | 1135402 Mr Anderson
Mr Anderson's picture

Average Americans believe we are doing the RIGHT and MORAL thing. They feel we have an obligation to police the world. To stop murders, rapists, and sovereign nations from determining their own fate.

Republicans legislate morality while democrats legislate compassion.

   The cost of Morality is War, the cost of compassion is Obamacare (which costs more in the long run, who knows.

Mon, 04/04/2011 - 19:26 | 1134866 FIAT_FixItAgainTony
FIAT_FixItAgainTony's picture

and the ponzi scheme attempts another extension of time....

how does that saying go?

oh yeah - same shit different day!

Tue, 04/05/2011 - 03:42 | 1135886 baby_BLYTHE
baby_BLYTHE's picture

Thumbs up!

Same sh** different day. (turn it up!)

Mon, 04/04/2011 - 19:32 | 1134873 Ned Zeppelin
Ned Zeppelin's picture

But this is how three card monte is played in the street.  You watch the folks excitedly

playing the game gathered around the cardboard box, as they make damn sure that

you see where the queen card is, so you feel like you can win, they turn to you and

ask you if you want to play.  Of course you say, handing over your Andrew Jackson

entrance fee, and play you do.

This is no different.

Mon, 04/04/2011 - 19:38 | 1134898 EscapeKey
EscapeKey's picture

The way to beat 3-card monte is to point to one, and then turn over the other two cards. I don't know how this translates into treasury purchases.

Mon, 04/04/2011 - 20:04 | 1134990 Moon Pie
Moon Pie's picture

+7........come eleven.

Only difference is that there's always one guy looking out for the cops.  These guys don't have that to worry about...enhances their margins, too.

Mon, 04/04/2011 - 19:32 | 1134877 InconvenientCou...
InconvenientCounterParty's picture

"Then in a development so ironic it would even make Alanis Morisette blush, we disclosed the very next day that Bill Gross dumped all of his Treasury holdings, pending an answer to the question of "who will buy US Treasurys once the Fed stops monetizing"

Alannis Morissette blushing gives me pause, but back in the real world, planned irony is known as theater. The Treasury and Fed knew damn well what Gross was going to do. My read is that he wanted assurances of QE3 and .gov said .f-off --threats ensued and which were subsequently acted upon. Predictably, a propaganda program started by the executive branch and fed to "shake the fleas off". scratch scratch.


Mon, 04/04/2011 - 19:35 | 1134893 Clycntct
Clycntct's picture

I think the answer lies in look in the pocket.

How much fedolla do they get to crapolla on the world.

And unlike me, they get paid to crapolla.

Mon, 04/04/2011 - 19:35 | 1134894 JimBobOMG
JimBobOMG's picture

I think i'll just bet my house for gold. A 4.5% apr equity loan for gold doesn't sound so bad.

Mon, 04/04/2011 - 19:38 | 1134900 no cnbc cretin
no cnbc cretin's picture

Bloomberg = CNBC

Mon, 04/04/2011 - 21:51 | 1135360 chinaboy
chinaboy's picture

if (Bloomberg == CNBC) then {

cut back your Blommberg TV time

ignore some of their articles


Mon, 04/04/2011 - 19:37 | 1134906 silvertrain
silvertrain's picture

An absolute must read nugget dropped on Friday afternoon that was missed..

Mon, 04/04/2011 - 19:39 | 1134910 dootyfree
dootyfree's picture

All the fear mongering over bond sales/debt ceiling on this site is ridiculous.  The bond markets only purpose it the control interest rates.  

Mon, 04/04/2011 - 22:48 | 1135492 NidStyles
NidStyles's picture

Yeah, I guess they don't serve as debt instrument's at all then, do they...


Let me guess, you actually like paying higher taxes.

Mon, 04/04/2011 - 19:41 | 1134914 PulauHantu29
PulauHantu29's picture

More Golden Showers from above. Where's my umbrella?

Thank God for Zero hedge and affiliated authors, editors and researchers!

Tue, 04/05/2011 - 03:49 | 1135891 baby_BLYTHE
baby_BLYTHE's picture


I <3 ZH and Tyler.

Mon, 04/04/2011 - 19:43 | 1134918 jkruffin
jkruffin's picture

So, why is Benny Bubbles not on the list in the first chart?  Is it to hide behind the curtain?

Mon, 04/04/2011 - 19:44 | 1134929 bluehorsesandal
bluehorsesandal's picture

That's a fantastic piece of information! Congrat's Tyler(s)! ZH ahead of the curve again...



Mon, 04/04/2011 - 19:46 | 1134930 rosiescenario
rosiescenario's picture

Not that this shall come as a surprise to those here, but I have noted that B'berg frequently gets it in 180 degress off.

Mon, 04/04/2011 - 19:46 | 1134937 spanish inquisition
spanish inquisition's picture

Just a practical joke that got out of hand ........

News room "Kruger get me 1000 words on why Treasuries are still good"

Construction site "Kruger, head to supply, I need a board stretcher and a left handed screwdriver"

Military "Kruger, get to communications and find me a POS E7" (pretty sure that is how this one goes, drunk when I heard it)

Mon, 04/04/2011 - 19:46 | 1134938 disabledvet
disabledvet's picture

a simple chart of "yen vs dollar" would have sufficed "on a day when...

Mon, 04/04/2011 - 19:49 | 1134946 tek77blu
tek77blu's picture

everything these fools keep doing will only result in a higher floor for gold and silver:

Mon, 04/04/2011 - 19:55 | 1134959 Ricky Roma
Ricky Roma's picture

Wow, Don Luskin just on Kudlow.  How does that dude have one client????  Scared at the bottom, loves it at the top.  Makes no relavence about economics.  I wanna punch that dude in his beaker face!  Full tard!

Mon, 04/04/2011 - 19:56 | 1134962 Shameful
Shameful's picture

Excellent! But I think we need to remember the Caribbean Hedge Funds that will load up over a trillion in treasuries a year should there be no QE3.  Not the most subtle of tricks, but when there is no public QE, have to do clandestine QE.

"Huh Rico Suave Investments holds 2 trillion in Treasuries...Who is this masked man who decides the fate of the US?"  I can only hope they have Zimbabwe Ben take a picture with a lucha libre mask for the official website.  Goes with his (dollar) death defying high risk financial action.

Mon, 04/04/2011 - 21:14 | 1135224 gabeh73
gabeh73's picture

agreed 100%...they have money printing power and absolutely no problem with lying, obfuscation, deception.

In WW1 they'd advance on trenches while blaring on the loudspeakers, "this is not an attack, we come in peace!" as they machine gunned anything that moved.


Not saying bond market won't crash, but be damned careful about the when and how...these tricky bastards will do it in a way to give themselves a chance.


Mon, 04/04/2011 - 21:22 | 1135251 cxl9
cxl9's picture

Agree. Somehow buyers will mysteriously materialize. If and when the Fed nominally stops buying those Treasuries, they'll just use straw buyers and claim it was the Brits or the Chinks or Caribbean banking centers or God-knows-who. And there are plenty of other tricks left to play. Eventually they're coming for all of the retirement accounts; that pool of wealth is just too big for the government to resist. They will seize that money and invest it in price-fixed Treasuries under the guise of "protecting the wealth of working familes from the vicissitudes of the stock market." Most people will eagerly welcome it when it happens, and then they will say goodbye to what little wealth they still had.

Mon, 04/04/2011 - 21:36 | 1135310 butchee
butchee's picture

Nice call!  Whenever QE stops is when the bond prices soar and the Carribbean hedge funds make their year distributing at the top and cycling back into the by then downtrodden stocks.

Mon, 04/04/2011 - 19:57 | 1134964 fbrothers
fbrothers's picture

Everyone will be so surprised. Again. Every deal will already be done.

Mon, 04/04/2011 - 19:58 | 1134967 israhole
israhole's picture

ZH gets to the bottom of things.

Mon, 04/04/2011 - 19:56 | 1134968 poydras
poydras's picture

I challenge anyone to find an actual Chinese reference for China's T holdings.

Mon, 04/04/2011 - 23:10 | 1135532 topcallingtroll
topcallingtroll's picture

It is a state secret. The average chinese needing real information bypasses web censors with free apps in all the internet cafes and.comes to.the usa to get such information

Mon, 04/04/2011 - 20:00 | 1134973 Clint Liquor
Clint Liquor's picture

"So allow us to debunk Bloomberg's second attempt (which we again hope is merely a function of misunderstanding of the subject material) at outright factless spin."

A kind gesture, giving Kruger the benefit of the doubt; We hope he's just stupid and not dishonest.

Mon, 04/04/2011 - 20:05 | 1134992 poydras
poydras's picture

The Basel rules essentially permit unlimited sovereign holdings rated AA or better.  Chewco Capital.

Mon, 04/04/2011 - 20:06 | 1135005 BKGuy
BKGuy's picture

Wouldn't we expect to see yields actually resume their plunge (as after the end of QE1) when the equity markets and other risk assets fall off a cliff as the secular forces of deleveraging and liquidity contraction overwhelm?

Mon, 04/04/2011 - 20:11 | 1135013 myTPisUSD
myTPisUSD's picture

Treasury Bubble Bitchez!


The monetary velocity from the inevitable and ensuing hot potato treasury dump will make Zimbabwe look like a good time.

Mon, 04/04/2011 - 20:17 | 1135040 camoes
camoes's picture

If we can't even trust Bloomberg, who can we trust? ZH to the rescue!!!!

Mon, 04/04/2011 - 20:18 | 1135041 max2205
max2205's picture

Go hammer 'em TD!!

Mon, 04/04/2011 - 20:24 | 1135057 Pepe
Pepe's picture

yeah, thank you for your work ZH

Mon, 04/04/2011 - 20:24 | 1135058 jkruffin
jkruffin's picture

Someone posted this the other day, but I edited it in order to deliver the right picture of the situation at hand:

How America Grows GDP

Obama tries to show the American people how great Bernanke is doing since they took over our country's finances. He hires a reporter to interview 3 people, see below:

The interviewer calls in a mathematician and asks "What do two plus two equal?" The mathematician replies "Four." The interviewer asks "Four, exactly?" The mathematician looks at the interviewer incredulously and says "Yes, four, exactly."

Then the interviewer calls in an accountant and asks the same question "What do two plus two equal?" The accountant says "On average, four - give or take ten percent, but on average, four."

Then the interviewer calls in Bernanke and poses the same question "What do two plus two equal?" Bernanke gets up, locks the door, closes the shade, sits down next to the interviewer and says "What do you want it to equal?"

Mon, 04/04/2011 - 20:32 | 1135080 FIAT_FixItAgainTony
FIAT_FixItAgainTony's picture

lol.  well put.

Mon, 04/04/2011 - 21:00 | 1135179 disabledvet
disabledvet's picture

and when you call in the lawyer he says "on or about four."

Mon, 04/04/2011 - 20:25 | 1135061 Broker NotBroke
Broker NotBroke's picture

So what's the play here? short treasuries? long credit card debt?

Mon, 04/04/2011 - 20:27 | 1135075 Rodent Freikorps
Rodent Freikorps's picture

How come ZeroHedge is so slow today?

Mon, 04/04/2011 - 20:33 | 1135094 FIAT_FixItAgainTony
FIAT_FixItAgainTony's picture

maybe because silver and gold are consuming bandwidth on their tears to new highs?  or maybe your isp sucks, as does mine upon occaision.  actually, today i'm loading just fine.

Mon, 04/04/2011 - 20:54 | 1135162 Rodent Freikorps
Rodent Freikorps's picture

My pron downloads have been fast. Maybe I finally got on a watch list.

Almost as good as getting a fatwa. I need to try harder.

Tue, 04/05/2011 - 17:53 | 1138749 JW n FL
JW n FL's picture

FATWA: 11 reasons why protesting is haram (7) instability in Saudi is instability to ALL Muslims

Mon, 04/04/2011 - 20:36 | 1135111 squexx
squexx's picture

A publication with a name from the "Evil Tribe," and you expect truth from it?!? LOL!

Mon, 04/04/2011 - 20:39 | 1135118 tradewithdave
tradewithdave's picture

I've said it a couple of times and with sincere respect to Mark Pittman, the fact that Bloomberg was the plaintiff in the case that led to last week's information release by the Fed has been bugging me for over a year.  Mark Pittman was not the plaintiff.  Bloomberg was the plaintiff.  For now I am filing the entire thing under the "planned reset switch disinformation campaign" file folder awaiting further review.

The back-story is here:

Dave Harrison


Mon, 04/04/2011 - 20:55 | 1135166 High Plains Drifter
High Plains Drifter's picture

ok, say they stop QE. what happens then?  either way, there is no way out for them and therefore no way out for us either. end game coming soon, perhaps?

Mon, 04/04/2011 - 20:56 | 1135168 Mr Anderson
Mr Anderson's picture

Has anyone ever checked to see if ZH is blocked in China?

Mon, 04/04/2011 - 20:55 | 1135171 Zero Govt
Zero Govt's picture

Great reveal Tyler

It's ironic Watergate was all about a couple of journalists revealing the lies in Washington. Here we are with 1,000 Nixons as journalists and 100 Watergates where Washington has become the offices of the mass media!

....the revealers have become the concealers, the reporters have become the cover-up crooks ...whatever happened to US journalism???

Mon, 04/04/2011 - 21:07 | 1135206 Reese Bobby
Reese Bobby's picture

I expect the press has always served a conduit for TPTB script of the day.  If a reporter tells the truth very long the easy sources dry up and they have have to actually work for a living  If they are just a conduit they can hit the bar early and simply pretend to be reporters.

It is probably just more noticeable now that the script is so absurd.

Mon, 04/04/2011 - 21:31 | 1135295 High Plains Drifter
High Plains Drifter's picture

Watergate was about getting rid of a selected president who had decided to leave the reservation.

Mon, 04/04/2011 - 23:46 | 1135614 Reese Bobby
Reese Bobby's picture

I used to think you were simply a nut job.  Lately I think you are a nut job who can see some pieces of a simple agenda.  I also think your "HPD" is a crock as I know 22 year old kids back from the war who would run your ass into the ground...God Bless

Mon, 04/04/2011 - 20:59 | 1135177 gigeze787
gigeze787's picture

Here's the Fed/Treasury set-up for QE2 endgame, with propaganda articles by the co-opted MSM already feeding the trade:

1) Get Bill Gross and Warren Buffett to convince Joe Six-Pack to short Treasuries:

What Bill and Warren know 
"When such überinvestors as Bill Gross and Warren Buffett turn  negative on Treasurys, what should we mere mortals do?..."

2)...And get CNBC to convince Joe Six-Pack to go long silver and gold:

Gold Could Gain 30% by Year-End: Fund Manager

Trade of 2011: Silver?

Stick with Silver?

Then screw them all with a Fed-engineered reversal fueled by the Fed backstopping prop trading by the TBTF banks at the expense of Joe Six-Pack.

(p.s. When the short bond ETF holders get scared and massively unload their holdings, Bill Gross will gladly buy their bonds at a discount). 

Lesson for the proletariat: Any trading (based on fundamentals) contrary to Dow 30,000 and ZIRP ad infinitum will be brutally punished and crushed.

Mon, 04/04/2011 - 21:01 | 1135182 Reese Bobby
Reese Bobby's picture

"...makes us truly wonder about the objectivity of Bloomberg."

I assume that is sarcasm because Bloomberg and objective cannot be used in the same sentence.


In fact they now glory in stupid disinformation much like Zimbabwe Ben cares not if his lying is obvious.  Screw informed people; they already know we get the dark humor  They are just assuming the lowest common denominator will accept their lies like poor little sheep.  Seems to be working less and less...

Mon, 04/04/2011 - 21:56 | 1135367 disabledvet
disabledvet's picture

the "main man's the Mayor" of some "rinky dink joint."  To "appease the angry 8 (million)" occassionally a "heads up" helps.  Still--even he is appearing "surprised a lot" lately.  KEENE!  In the office!  What the....%$#$$$ going on here!

Mon, 04/04/2011 - 23:55 | 1135634 Reese Bobby
Reese Bobby's picture

Dude. Calmly accept Christ into your life.  For a great starter book read, "Kings Cross" by Tim Keller.

God Bless.

For Grass Roots Christian theology read "Peace with God" by Billy Graham.


Mon, 04/04/2011 - 21:08 | 1135203 infiniti
infiniti's picture

Bloomberg makes their money from those neat-o terminals that provide info to bond managers all over the world.


More debt=More terminals=More revenue.



Mon, 04/04/2011 - 21:14 | 1135221 Village Smithy
Village Smithy's picture

Tyler, I read that article earlier today and thanks to the fact that I had read your earlier post on this "error" on Bloomberg's part I was sceptical. Had I not been a ZH reader I would have just assumed as you said that all was well in treasury world and perhaps wondered why the Chinese were still so interested. Instead I thought  to myself  this is more MSM BS I hope Tyler catches this, and obviously you did. Zero Hedge is working, slowly those of us who care are are waking up. People are learning things here and passing on the knowledge and your web address.  Thank you.

Mon, 04/04/2011 - 21:21 | 1135245 jharry
jharry's picture

I think I'll play the devil's advocate today. I say all this talk about no one buying Treasuries is entertaining, but it doesn't mean much.  China and the US cut a deal a long time ago.  Bernanke and his crew own the friggin' bank and are not worried about something blowing up.  Here's part of the skinny on what's going on with the Fed's buying of Treasuries which is given to us by Jim Rickards in March 11, King World News.  It's a matter of stocks and flows.  He writes, "The size of the Fed's balance sheet is so vast that the reinvestment of principal payments from the existing assets will be enough to monetize a large portion of the Federal deficit without having to increase the total size of the balance sheet."  According to him, "there's nothing hidden going on. It's a matter of math."

Mon, 04/04/2011 - 21:27 | 1135274 Tyler Durden
Tyler Durden's picture

Ok, we have had it with this statement which apparently if repeated enough times will become true, regardless of the facts. This claim is patently false. Below is a table of the maturity distribution of Fed assets. Most importantly, there is $144 billion in Bonds and Agencies that mature in under a year. That's $144 billion! The Fed monetizes just a little over this total each month currently. Add in a generous $60 billion in MBS prepays in one year (which is very generous assumption as the jump in rates will effectively stop mortgages from being paid back), and the total that the Fed will monetize from rolling and prepays is $200 billion. In one year. In QE2 the Fed is monetizing $900 billion in 8 months. Do you see what the issue is?

Mon, 04/04/2011 - 22:09 | 1135405 Yits and the Yimrum
Yits and the Yimrum's picture

Tyler, head for the safe house #11.


the ministry of Truth is running out of PR funds to keep up the shtick.

as always, thanks for the timely info


Based on this info, I think I'll pass on the Maiden Lane IV deferred annuity plan.

Mon, 04/04/2011 - 22:47 | 1135484 the grateful un...
the grateful unemployed's picture

if the Fed monetizes the 200 billion that matures, with no issuance, assuming no one wants to buy new paper, that is pretty much at a rate which the Fed is used to, and what that means is that instead of adding new money to the system they are merely paying back previous obligations. when the cost of paying off the obligations on the old debt, exceed the amount of new debt needed to keep the economy growing, then we are in fukashima land?

Tue, 04/05/2011 - 00:02 | 1135644 Reese Bobby
Reese Bobby's picture

Solid analysis.  But Central Bankers just find it funny...

Like rats with a morphine button; who needs food...

Mon, 04/04/2011 - 21:41 | 1135328 High Plains Drifter
High Plains Drifter's picture

Rickards has been known to come down on either side in some arguments. He is kind of a weasel who was up to his eyeballs in the LTCM debacle in 1998.

Mon, 04/04/2011 - 21:46 | 1135335 chinaboy
chinaboy's picture

Personally, I don't want to see US treasury dumped by all because of Chinese selling. At the same time, I don't want to see Chinese holding suffer loss because they are stupid eoungh to keep holding the bag.


The reality is both are very likely. China is going to sell some day. If they do not initiate it, they will do it after they see loss. Once they puke, the buyers are likely asking good concession.


The only way to prevent it from doing damage is to keep reminding the danger involved. that way, the U.S. is well prepared so as not to get hurt. At the same time, China can learn from reading article like this to know the risk they have on their hands.


In China, a lot of people strongly dislike the country holding U.S. treasury. However, they are powerless to change the situation. Even in the U.S., there is nothing you can do to prevent the Chairsomeone from printing money.



Mon, 04/04/2011 - 22:08 | 1135403 disabledvet
disabledvet's picture

i would argue "you blow up the banks", excuse me "the bankers" most of whom as no one would argue "don't get paid shit" and "debt has a problem."  that's because in my view "you have to have the private banker take your public debt."  in theory of course "the Fed is a private bank."  Obviously that is not true.  "They are a government bank."  Period.  Now onto my movie script loosely titled "Debt Takes a Holiday."  It's a darker version of "Death Takes a Holiday."  As i write i understand...FAR darker.

Mon, 04/04/2011 - 23:01 | 1135515 topcallingtroll
topcallingtroll's picture

If they dont keep recycling dollars into treasuries the dollar will weaken and break the peg. China is trapped. They will continue to subsidize the usa or they will end the peg and suffer mass unemployment and the mother of all ghost city real estate and banking collapse. We in the usa have the upper hand because the.chinese underestimated us.

Never under estimate your opponent and.assume you are superior.

Mon, 04/04/2011 - 21:31 | 1135282 chinaboy
chinaboy's picture

Bloomberg articles can be very low quality. Especially in its commodity section. When price rises on Monday, it is China demand. When price drops on Tuesday, it is China demand less. They are flipping analysis like a heartless robot. 

Good thing we can read zerohedge for analysis.


Mon, 04/04/2011 - 21:31 | 1135296 eddiebe
eddiebe's picture

I have a question related to bonds and why the fed is buying. I would imagine others have pondered this and come up with answers that make sense..

 We know that the fed is a private enterprise cosisting of very powerful and wealthy interests/people.

 Why would they buy notes at these low rates knowing that the $ is being inflated, in fact I assume they are devaluing the $ themselves, or so it appears to me. What could be their motive?

 I doubt that they are doing it out of the goodness of their hearts, to help out the good people of the U.S; what are they buying? What are they shorting, or what do they have in store for all the bonds they are buying with increasingly value less $'s? 


Mon, 04/04/2011 - 22:11 | 1135407 disabledvet
disabledvet's picture

"new" bonds, crisp and clean.  i recommend the paper variant in VERY large denominations.

Mon, 04/04/2011 - 22:46 | 1135486 eddiebe
eddiebe's picture

I've never heard of new bonds, could you explain?

Mon, 04/04/2011 - 22:34 | 1135452 the grateful un...
the grateful unemployed's picture

they're merely managing Treasuries off balance sheet account, when TSHTF the liabilities all go back to Treasury, (unless of course you think the Congress and the Tea Party can stop it - sideline Obama will raise one BILLION to tell us what to do, for the next four years)

Mon, 04/04/2011 - 22:46 | 1135483 eddiebe
eddiebe's picture

thanks, but I still don't get it. What's in it for them? Why keep the system going at all? For access to using the military? /what?

Mon, 04/04/2011 - 22:53 | 1135500 topcallingtroll
topcallingtroll's picture

To embed themselves in our government and influence it to their benefit. It was never intended by rothschild warburg etc and others to make significant money directly. It is their loss leader.

Mon, 04/04/2011 - 22:56 | 1135512 eddiebe
eddiebe's picture

What is a loss leader?

Tue, 04/05/2011 - 11:40 | 1137058 the grateful un...
the grateful unemployed's picture

and it is possible that Congress won't allow the Fed to offload their debt, but that would take a supreme act of political courage, and really put the fork in the Federal Reserve once and for all. What cabal of private banks would have put up THEIR money to bail out the US banking system in 2008, with no transparency, and constant dissembling from the Bush administration, (which was about out of time anyway). That would have been interesting.

Mon, 04/04/2011 - 21:35 | 1135302 El Hosel
El Hosel's picture

  Fear radiating through the liquidity?

Mon, 04/04/2011 - 21:47 | 1135338 Hephasteus
Hephasteus's picture

Holy crap their robo-market is eating it's own EAX registers at the end of every run.

Mon, 04/04/2011 - 21:52 | 1135345 Atomizer
Atomizer's picture

Globalising toxic debt has become a humanitarian effort. The clever sheeple are told not to ride this conspiracy horse.

Mon, 04/04/2011 - 21:49 | 1135346 GoldmanSux
GoldmanSux's picture

Factless spin. Bloomberg is a disgrace.

Mon, 04/04/2011 - 21:58 | 1135374 Newsboy
Newsboy's picture


There will be demand for US Treasuries when the Euro goes all collapsie.

When will that be?

Please coordinate QE(n+1) with Euro collapse timetable.



Mon, 04/04/2011 - 22:02 | 1135387 TooBearish
TooBearish's picture

Its not only insulting because Bloomberg as monopoly power over bond market participants, to be subjected to this kind of misinformation, its embrassingly inaccurate "reporting".  Bloomberg's service is way too expensive to but he's got no competition.

Mon, 04/04/2011 - 22:23 | 1135417 mark mchugh
mark mchugh's picture

Fun fact: When Treasury released the revisions to the Major foreing Holders report on February 28, 2011 they revised 75% of the purchases between July 1, 2009 and June 30, 2010.  Less than 25% right.

Here's the data:  Check for yourself.

$542B attributed to foreigners during the period....$407.9B got revised to different foreigners later ($815.8 /2).  75% fail rate.

Funner Facts: The second set of garbage data released by Treasury is the Auction Allotments By Investor Class For Marketable Treasury Securities which gets split into short and long term:

According to these documents, foreigners only take down 18.54% of Coupons (long term) and 8% of Bills.  More than 40% of short term issues is unaccounted for.  "Dealers and Brokers" are credited with the lions share on both reports. 

But, but we know it's foreigners....

Sure ya do.

Here's an outline of the data flow:

  • Auction Results – (minutes after the auction)
  • Investor Class Auction Allotments – (2 to 6 weeks after auction) Seperated into short term and long term.
  • Quarterly Treasury Bulletin (incomplete until 5 to 8 months after auction).
  • Revisions to Major Foreign Holders of Treasury Securities (issued annually - 8 to 20 months after auction, and data is still identified as “preliminary”).

(see Missy, I have been working on this)

Now understand what I call "the velocity of crap"

Keep roshamboing these clowns, Tyler

Better yet, ask them if they know how much of this crap is being held in repurchase agreements at the Fed, and how they figured it out......

(crickets chirping....I'll bet)

Mon, 04/04/2011 - 22:46 | 1135487 topcallingtroll
topcallingtroll's picture

It isnt easy to get it right when all the peggers and.soft targeters hide their purchases thru the uk and dealers.

No country, especially asian countries, wants to admit they are punks that service the united states. It is.kinda shameful, so they hide their.shame as best they can. Rest assured they will service our needs as long as we need them to. Peggers and.soft targeters are our bitches to use however we wish.

Mon, 04/04/2011 - 23:13 | 1135536 mark mchugh
mark mchugh's picture

But when you look at all the borrowing by foreign banks at the Fed's discount window, that alone more than explains foreign demand.

For the record, If you will give me free money, I'll buy Treasuries too.

C'mon Ben, you do it for everybody else, why not me?

Mon, 04/04/2011 - 22:27 | 1135440 DoctoRx
DoctoRx's picture

Bloomberg's Daniel Kruger . . . cheery picks some other data . . .

Marvelous typo!

Then a question:  Did you mean short rates will surge rather than plunge when you said near the end:

We expect that in the absence of QE2, the 10 Year to be fairly priced about 200 bps wide of where it is trading now, somewhere in the 5.50% range. Which, incidentally, will lead to a complete devastation in the US housing market, a plunge in short-end yields, a huge bear flattening in the market, and the next financial system collapse.

Mon, 04/04/2011 - 22:41 | 1135469 topcallingtroll
topcallingtroll's picture

Anyone who wants to maintain a peg will have to choke.down as many treasuries as we care to emit.

Someone said china is just a punk in the dollar prison.

Choke on this bitch. Then turn around and bend over, cuz we got lots more for your yellow ass.

Mon, 04/04/2011 - 22:53 | 1135499 jharry
jharry's picture

Tyler Durden! Tyler Durden! Tyler Durden!

Tue, 04/05/2011 - 10:28 | 1135904 baby_BLYTHE
baby_BLYTHE's picture


Mon, 04/04/2011 - 23:14 | 1135539 kito
kito's picture

what if the fed just forgave all the treasury debt? would it really matter if my father (married to my mother using a joint bank account) owed my mother 100 bucks and she then forgave the debt? think of how much is sliced off of our debt load! anyone?

Mon, 04/04/2011 - 23:43 | 1135602 Magoo
Magoo's picture

I think maybe  ->fractional banking

your mom forgives your dad's debt the net account balance has not changed

the Fed forgives the Treasury Debt, all Dealers who sold bonds to the Fed still have had their respective reserve account balances increased, thus money created, that is how the printing press works. So yes the amount of debt outstanding decreases (good for the nation), but the amount of Bank reserves have has been printed - no?

Tue, 04/05/2011 - 09:24 | 1135981 Rikki-Tikki-Tavi
Rikki-Tikki-Tavi's picture

If the world in fact was crazy about UST (and equities for that matter) wouldn't the dollar get stronger? Most US ETF's/mutual funds available to people outside the US won't hedge the currency risk so if the moms and pops of the world in fact were buying like crazy I don't think the dollar would weaken everyday. However if non-US citizen, like myself, are closing down their dollar accounts and run for the hill the price action in UUP makes more sense to me. To suggest that a yield of a few percents compensates me for the FX risk I would face on a UST position (which in itself grossly is underpaying for the rate and inflation risk due to massive manipulation) makes me laugh - perhaps after radical changes and sacrifices have been made...

Tue, 04/05/2011 - 09:19 | 1136332 Chuck Walla
Chuck Walla's picture

I believe the Chinese are slowly backing towards the door.

Sat, 04/09/2011 - 21:57 | 1154239 thames222
thames222's picture

Bloomsters, stop lying to us and to yourself!  Durden, thanks for debunking this one, disinformation and misinformation are killing our society at large.

Do NOT follow this link or you will be banned from the site!