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Fed Announces Weak POMO Schedule, Only $97 Billion In Monetizations For The Next Month

Tyler Durden's picture


The New York Fed has just released its latest POMO schedule for the upcoming month, and it may make some market members unhappy. Unlike the previous several monthly monetization dockets, this one will only see the Fed pump $97 billion in the market consisting of $80 billion in USTs from the QE2 mandate, and $17 billion in Treasurys due to MBS putback issues per QE Lite. This is $15 billion less than the last POMO schedule which saw $112 billion scheduled to be monetized. The schedule runs through March 9, and the next schedule will be presented on March 10 and 2 pm. There are no double POMO days in the current schedule. Of course, with $195 billion in incremental liquidity from the SFP program winddown, the Fed likely does not need to drown everything in its relentless liquidity.


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Thu, 02/10/2011 - 15:16 | Link to Comment FOC 1183
FOC 1183's picture

That's almost 10% below the first three operations; and they're already down $1.5 Billion on their January purchases alone.  So they've got that going for them.  Which is nice

Thu, 02/10/2011 - 15:28 | Link to Comment Josh Randall
Josh Randall's picture

Gunga-Ga-Loonga...Big Hitter The Bernake. That schedule pre-supposes no uprising or is that baked in ?

Thu, 02/10/2011 - 15:14 | Link to Comment hambone
hambone's picture

Is there a printed schedule for the SFP winddown as well?

Thu, 02/10/2011 - 15:24 | Link to Comment Misean
Misean's picture

The printers are busy pumping out Benny are the CPU cycles.

Thu, 02/10/2011 - 15:16 | Link to Comment Fourth Horseman...
Fourth Horseman of the Apocalypse's picture

Treasuries selling off on the news.  QE Lite is a decline of over 50% from the prior schedule.  Somehow they bumped QE II up from $75 billion to $80 billion to mitigate the fall off.  We need to watch the Fed's balance sheet reports for the balances of the MBS portfolio.  If they continue to remain flat, QE Lite may fall near zero in the next schedule.  


Thu, 02/10/2011 - 17:42 | Link to Comment davepowers
davepowers's picture

re QE Lite - I wonder how much of QE Lite was only fired by a refinancing boom due to low mortgage rates vs. a natural maturation and pay off of the MBSs. If the former, then rising mortgage rates will indeed kill off that avenue by which the FED got out from under the previously purchased and perhaps toxic MBS paper.


Thu, 02/10/2011 - 15:16 | Link to Comment grunk
grunk's picture

Quantitative Easing means never having to say you're sorry.

Thu, 02/10/2011 - 16:43 | Link to Comment MarketTruth
MarketTruth's picture

And.... Aww baby, i won't QuEase in your currency's 'mouth'.

Thu, 02/10/2011 - 15:18 | Link to Comment MyKillK
MyKillK's picture

I like how the Treasury and the Fed are now colluding together to spread out the liquidity injections. Once the SFP winddown ends, the Fed will have more powder left in its keg to really ramp the markets. The money printing cartel continues unabated.

Thu, 02/10/2011 - 15:22 | Link to Comment IrishSamurai
IrishSamurai's picture

Don't worry ... Sack's resting his "sack" right now ... the Market will get wood around 3:45 and Shalom's face will get its daily injection load ...

BTFD because the market ...




Fri, 02/11/2011 - 00:06 | Link to Comment StychoKiller
StychoKiller's picture

Ya know, the Fed is approaching 100.  It's getting harder to get around and do BM's (Bernank Movements!) :>D

Thu, 02/10/2011 - 15:27 | Link to Comment Prof Gulliver
Prof Gulliver's picture

The idiot Fed chairman told Congress yesterday he is "not concerned" at all about rising Treasury yields. Looks like the bond market -- the one the idiot Fed chairman cannot control or manipulate -- is calling his bluff.

Thu, 02/10/2011 - 15:28 | Link to Comment Misean
Misean's picture

Ol B.S. Bernutty needs to read Misean on that whole crack up boom thing. The second derivative of the money supply needs to be positive or you get a crash. Of course, you get a crash either way, but ol' Benny prefers the Weimar kind, so who am I to argue...

Thu, 02/10/2011 - 15:31 | Link to Comment Bruno the Bear
Bruno the Bear's picture

"will only see the Fed pump $97 billion"

I'm just trying to remember when the word "only" and "$97 billion" used in the same sentence would have been considered a typo.


Strange times.



Thu, 02/10/2011 - 15:32 | Link to Comment mule65
mule65's picture

Uh-oh, AAPL having glitchiness today.

Thu, 02/10/2011 - 15:37 | Link to Comment rosiescenario
rosiescenario's picture

...well that explains why the market is weak today...someone better tell Ben that this sissy sized POMO just ain't gonna cut it....we need super sized double POMOs...

Thu, 02/10/2011 - 15:39 | Link to Comment Cursive
Cursive's picture

March is looking pretty rocky for the risk-on crowd.

Thu, 02/10/2011 - 15:56 | Link to Comment rumblefish
rumblefish's picture

can someone explain terms  risk on vs risk off as its used in the world of zero hedge?

Thu, 02/10/2011 - 15:40 | Link to Comment lunaticfringe
Thu, 02/10/2011 - 15:46 | Link to Comment RobotTrader
RobotTrader's picture

Some robots are misfiring today.....

Lots of jello being pushed across the plate today.


Thu, 02/10/2011 - 15:58 | Link to Comment system failure
system failure's picture

POMO is rather weak, considering additonal funds are going to be needed to pay the China GSE holdings $500,000,000,000.00

Oh, not to forget about the GSE themselves being passed off onto the already greatly unemployed tax payers.

And all those baby boomers retiring at roughly 8,000 to 10,000 a day and drawing Social Security payments.

Heaven forbid, we make a principle payment on the national debt, let alone just the interest payments.

Total bill = POMO will never pay for any of this.

Thu, 02/10/2011 - 16:00 | Link to Comment raya123
raya123's picture

Say good-bye to the secular bull market.

Thu, 02/10/2011 - 16:10 | Link to Comment digalert
digalert's picture

$97 billion? We've got bank failure Friday tomorrow...

What will Sheila Bair do for cash?

Thu, 02/10/2011 - 16:11 | Link to Comment LawsofPhysics
LawsofPhysics's picture

What?  The Fed is wading further into the waters of reality? - NOT

Thu, 02/10/2011 - 16:22 | Link to Comment myTPisUSD
myTPisUSD's picture

When the Treasuries Break



The Fed keeps on printing, treasuries gon' break
The Fed keeps on printing, treasuries gon' break
When the treasuries break, hyperinflation hits

Mean ol Bernanke taught me to weep and moan
Mean ol Bernanke taught me to weep and moan
Got what it takes to make an American leave his home

oh well, oh well,oh well

Don't it make you feel bad?
When you're trying to find your way to safety you don't know which way to go?
When you're going up north and there's no where to hide
And you're going on to the Yukon

Crying won't help you, praying won't do you no good
Crying won't help you, praying won't do you no good
When the treasuries break, mama, you got to go

All last night sat in my foreclosed house and moaned
All last night sat in my foreclosed house and moaned
Thinking about my old life and my happy home

Going - going to the Yukon
Going to the Yukon
Sorry, but I can't take you

Dollars down - going down, now
Going down - going down, now
Going down
Going down
Going down
Going down

Going down - going down, now
Going down - going down, now
Going down - going down, now
Going down
Going dow-, dow-, dow-, dow-, down, now

Thu, 02/10/2011 - 17:50 | Link to Comment archfool
archfool's picture

$15 billion less?  Not really.  Remember, we lose 2-3 business days because February is shorter. Probably like $5 billion less, IMO.

Thu, 02/10/2011 - 19:21 | Link to Comment zaphod
zaphod's picture

I don't know whether to laugh or cry that the fact the FED is "only monetizing $97B" in one month can be spun positively.

Fri, 02/11/2011 - 01:30 | Link to Comment Yen Cross
Yen Cross's picture

Oh ya< save the best for last! POMO. Those menial little punks that siphen off bond spreads from the Fed before (BID to MARKET) Like Today on the 30's?

Fri, 02/11/2011 - 01:31 | Link to Comment Yen Cross
Yen Cross's picture

I have to work people. Europe coming up!!!

Fri, 02/11/2011 - 09:14 | Link to Comment overmedicatedun...
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