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First POMO Of 2011 Closes As Sack Buys $7.8 Billion Of 2018-2010 Bonds; PDs Refuse To Flip Underwater Positions

Tyler Durden's picture





 

And so the first POMO of 2011 is in the history books. Brian Sack just bought $7.79 billion worth of bonds with a maturity between 2018 and 2020. At just a 2.2 submitted to accepted ratio, this was yet another auction in which the PDs had more than enough cash in advance, and did not need the Fed's generosity. Incidentally, Brian Sack put the most recent 10 year issuance, the PC8s of 11/15/2020, which were the auctioned off security in both November and December's reopening, on the exclusion list, and the one issued just before that, the NT3s of 2020, saw exactly zero bids confirming that even PDs need to have an apriori profit before they flip a given bond.

 


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Mon, 01/03/2011 - 13:10 | Link to Comment Jason T
Jason T's picture

why is monetary base dropping with the POMO in hand?

http://research.stlouisfed.org/fred2/data/BASE.txt  OR is that just the ST. Louis fed

Mon, 01/03/2011 - 13:12 | Link to Comment Ragnarok
Ragnarok's picture

Shadow banking falling faster than the Fed can print?

Mon, 01/03/2011 - 14:12 | Link to Comment TruthInSunshine
TruthInSunshine's picture

why is monetary base dropping with the POMO in hand?

 

Check out John William's ShadowStat charts on M1, M2 & M3, also.

I've been pointing this out for a while, but no one seems interested.

Mon, 01/03/2011 - 13:10 | Link to Comment inkt2002
inkt2002's picture

Its getting embarrassing reading all this bad news while the market continues to mock you.

Mon, 01/03/2011 - 13:13 | Link to Comment TradingJoe
TradingJoe's picture

Not embarrassing but funny! Until The Real Fun sets in! When? That's the "fun" part!

Mon, 01/03/2011 - 13:15 | Link to Comment inkt2002
inkt2002's picture

ZZZZZZZZZ.. Where have I heard this before?
Oh,I remember. Here- for the last 2 years.

Mon, 01/03/2011 - 13:22 | Link to Comment Internet Tough Guy
Internet Tough Guy's picture

Right. Nothing bad has happened in the last two years.

Mon, 01/03/2011 - 14:01 | Link to Comment Drag Racer
Drag Racer's picture

accellerating to 480mph and all is good until its not...

http://www.youtube.com/watch?v=mTa9JzRlxRQ

Mon, 01/03/2011 - 13:22 | Link to Comment Boilermaker
Boilermaker's picture

No kidding.  I think the site has been highly recommending some bullshit about precious metals too.  What a bunch of morons.

Mon, 01/03/2011 - 14:21 | Link to Comment wiskeyrunner
wiskeyrunner's picture

Saving grace indeed.

Mon, 01/03/2011 - 13:16 | Link to Comment Sean7k
Sean7k's picture

Why do you visit then? If I failed to benefit from a site, I wouldn't waste my time. Does this mean you are mentally deficient, a troll or both?

Mon, 01/03/2011 - 13:29 | Link to Comment Boilermaker
Boilermaker's picture

Consider it 'exhibit A' from a wide range of evidence of WHY they are jacking the market.  It works on dipshits and there are alot of dipshits.

Mon, 01/03/2011 - 13:16 | Link to Comment Deep
Deep's picture

guys like you make me laugh. The market has DONE JACKSHIT IN 10 + YEARS. and you guys hang on to it like it has gone bonkers.

But let me guess, you bought at the botto, sold at top for 10years.

GET A LIFE

 

 

Mon, 01/03/2011 - 14:16 | Link to Comment TruthInSunshine
TruthInSunshine's picture

He bought in 1995, with leverage, sold in 1999 (right before the meltdown), and went short with leverage, bought again in 2003, with leverage, but sold all positions and went short right before the 2007-2008 meltdown, and bought again in 2009, with leverage.

When the market crashes again, we'll find out he had sold all positions in the nick of time, and went short with leverage.

His stop orders are also a special breed that let him exit positions with minimal losses during massive crashes.

In the mean time, we are witnessing true 'painting of the tape' on the indexes.

Mon, 01/03/2011 - 14:55 | Link to Comment kaiserhoff
kaiserhoff's picture

LMAO

Where can I get me some of them thar "special breed" stop orders?  Mine always bit me a new arse hole;)

Mon, 01/03/2011 - 15:02 | Link to Comment Boilermaker
Boilermaker's picture

<AHEM>...excuse me Sir, this area is reserved for First Class people only.  If you would be so kind as to stay behind the velvet rope while they exit first.  Thank you for your cooperation.  No, you can not speak to the Manager.

Mon, 01/03/2011 - 15:33 | Link to Comment RonnieHonduras
RonnieHonduras's picture

Better yet, feel free to dig through the dumpster like everyone else.

Mon, 01/03/2011 - 23:22 | Link to Comment Hat Trick
Hat Trick's picture

I agree! This market is certainly a direct reflection of the economic reality of the average citizen, or the country in general. I bet we can go on printing and monetizing debt forever! It's not like we'll ever have to pay that $14 Trillion back. I mean, basic arithmetic shows that it's not even possible. So quit worrying people!

Mon, 01/03/2011 - 13:14 | Link to Comment Cognitive Dissonance
Cognitive Dissonance's picture

the NT3s of 2020, saw exactly zero bids confirming that even PDs need to have an apriori profit before they flip a given bond.

What do you think these PDs are in it for? Certainly not for the greater good or even public service. If they can't count on guaranteed profits before the fact, there will be no fact. Market risk is for losers and plebs.

Mon, 01/03/2011 - 13:21 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

apriori profit

That is the funniest term I have ever heard.  'There is a profit outside of itself, that which exists before the profit has been made.'

Haha!

Mon, 01/03/2011 - 13:55 | Link to Comment MachoMan
MachoMan's picture

Funny and sadly accurate...  it's the only hypothesis that explains PD involvement...  most rational actors aren't in the game for losses every purchase and attempting to rectify by making it up on volume...  We really don't need any smoking gun, whistleblower, or other document...  it's apparent from the exchange and, imo, would be sufficient to state claim for conspiracy, if what they were doing could ever be declared illegal (they already covered that base).

Mon, 01/03/2011 - 14:12 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

MachoMan for SEC Chair.

Mon, 01/03/2011 - 16:23 | Link to Comment MachoMan
MachoMan's picture

MM for plaintiffs attorney looking to pick up where our lapdog legislature capitulated.  If I think what they're doing is likely legal, then I wouldn't do much good at the SEC...  well, I guess I could settle cases on the cheap with the best of them, but I'd rather give them a jury of their "peers" and let the chips fall where they may.  I'm thinking punies would be nice too...  although, those have largely been curtailed by the SCOTUS...  I'm thinking the degree of reprehensibility/ongoing nature of the endeavor would warrant a hands off approach though...  I don't think 100x compensatory damages would be out of the question.

And I say plaintiffs attorney like I would be in the driver seat...  I think coffee fetcher for plaintiffs attorney would be more fitting.  Civil conspiracy is one of those things that in most places gets you to a jury simply because no one (not even the court) knows what the fuck it is...  about as vague of a doctrine as possible...  file the lawsuit and forget...  win the thing in voir dire... 

Tue, 01/04/2011 - 00:42 | Link to Comment TruthInSunshine
TruthInSunshine's picture

Nope.

You don't see that many cases, as a proportion compared to other areas of tort law, because of mandatory arbitration clauses and other, incredibly one-sided, oppressive terms.

I do believe in freedom of contract, however, even though the legal disclaimers and such profound boilerplate exculpatory clauses in broker/dealer and investment advisor contracts push me to my logical limits, admittedly.

Tue, 01/04/2011 - 09:09 | Link to Comment MachoMan
MachoMan's picture

To say that mandatory arbitration clauses and the like aren't favored by the law would be an understatement.  They've got to be pretty narrowly tailored and, most importantly, impose mutual obligation to be enforceable here...  It's not that hard to find some sympathy from a judge in this regard. 

Mon, 01/03/2011 - 13:23 | Link to Comment JackTheTrader
JackTheTrader's picture

And so goes 2011, and 2012.....

Mon, 01/03/2011 - 13:26 | Link to Comment gwar5
gwar5's picture

POMO 2011: Economic central planning at it finest.

All the critics must be marooons. What could go wrong?

Mon, 01/03/2011 - 13:31 | Link to Comment Fidel Sarcastro
Fidel Sarcastro's picture

What?  Harry Wanger hasn't posted the AAPL news yet?  New highs, he knew it all along, etc???

Mon, 01/03/2011 - 13:31 | Link to Comment Boilermaker
Boilermaker's picture

He's waiting on Robo to post a 12 month chart first.

Mon, 01/03/2011 - 13:36 | Link to Comment Prof Gulliver
Prof Gulliver's picture

12 months? That's like the end of eternity for Robo. He's trading on 12 second charts now.

Mon, 01/03/2011 - 13:40 | Link to Comment TruthInSunshine
TruthInSunshine's picture

Got to send a message on the 1st of the New Year. All is well, and there is no risk in these markets.

Buy with confidence. 100%.

The Bernank's eBay reseller ratings are high.

Mon, 01/03/2011 - 13:52 | Link to Comment thepigman
thepigman's picture

Laughable sell side analysts on TV

now attributing it all to exciting fundamentals.

These guys can never tell the truth.

 

Mon, 01/03/2011 - 13:57 | Link to Comment thepigman
thepigman's picture

And the truth is the Bernank is jacking

equities to keep the 30% of the consumers

who buy everything happy. These

schnooks only happily consume when stocks

are up. Too funny. Talk about sheep.

Mon, 01/03/2011 - 13:52 | Link to Comment Boilermaker
Boilermaker's picture

Yea, no doubt about that.  The timing is well...suspect to say the least.  It's a great headline though "Stock start 2011 with a BANG"!.

Yea, it's nauseating.

 

Mon, 01/03/2011 - 14:24 | Link to Comment El Hosel
El Hosel's picture

  "As goes the first week in January goes the year"....  Blah Blah Blah, That will make for some nice headlines.

      Better add to my collection of giggling tits.

Mon, 01/03/2011 - 13:58 | Link to Comment buzzsaw99
buzzsaw99's picture

The PDs know it is zirp 4evah, why the hell would they sell anything at a loss?

Mon, 01/03/2011 - 14:37 | Link to Comment NotApplicable
NotApplicable's picture

And how do they know?

http://www.acme.com/licensemaker/licensemaker.cgi?state=New+York&text=ZR...

(recently spotted on a limo driving down Wall St.)

Mon, 01/03/2011 - 14:20 | Link to Comment Instant Karma
Instant Karma's picture

It's all fun and games until someone gets hurt!

Buy overbought and sell overboughter!

That doesn't seem like good discipline.

Yet MCP is up 15%.

We got a stock bubble brewing. Smell the coffee.

Mon, 01/03/2011 - 14:28 | Link to Comment El Hosel
El Hosel's picture

  Did Al Gore invent Rare Earth Minerals too?

        http://www.youtube.com/watch?v=ridO5LS6KR4

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