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Reverse Repo Closes, Whopping $2.2 Billion In Liquidity Taken Out Of Market

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Tue, 03/29/2011 - 13:56 | 1113475 unwashedmass
unwashedmass's picture


how soon do we think Bernanke resigns? I'm betting before yearend, possibly end of summer. Just before the real horror show begins

Tue, 03/29/2011 - 14:45 | 1113702 Bam_Man
Bam_Man's picture

Bernanke will step aside shortly. I am very surprised he has lasted this long.

The Fed has painted itself deep into a corner and getting out will be extremely "messy". He will soon hand the mess to some other sociopath megalomaniac, probably citing "health reasons".

Tue, 03/29/2011 - 15:09 | 1113792 Tom Servo
Tom Servo's picture

Is another Jew in the on-deck circle to take the reins?

Tue, 03/29/2011 - 22:37 | 1115457 Papasmurf
Papasmurf's picture

I'm sure Lloyd Blankein would serve some time in this position as a service to the communiity.

Tue, 03/29/2011 - 15:45 | 1113945 Popo
Popo's picture

Let's not forget that Greenspan attempted (briefly) to pull liquidity out of the market, and the market tumbled. Realizing he was f*cked, he resigned and handed the hot potato to Bernanke.

Bernanke knows full well that it is impossible to drain liquidity without collapsing his entire ponzi sham. He will pass the ball to someone else. But not before a few more absurd claims of "tailwinds", "sustainability" and success.

When we see the "Mission Accomplished" moment, you know he's fueling up the Gulfstream. (or more likely just running back to the security of ol' Princeton).

Central planners love to sound erudite and pensive about their policies, when the reality is that they are binary in nature, and in reality have only one setting: Print.

Tue, 03/29/2011 - 15:05 | 1113776 TheMerryPrankster
TheMerryPrankster's picture

Bernanke will die in a helicopter accident. The irony will be great, as will the implied warning for his successor.

Tue, 03/29/2011 - 13:57 | 1113480 Cognitive Dissonance
Cognitive Dissonance's picture

Market doesn't seem to care.


Tue, 03/29/2011 - 14:09 | 1113537 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

What market?

Tue, 03/29/2011 - 14:13 | 1113566 thedrickster
thedrickster's picture


Room temperature meat.

Tue, 03/29/2011 - 15:33 | 1113898 johngaltfla
johngaltfla's picture

We got a free market? When, where? I saw a picture on a milk carton years ago, somoene please, show it to me? Where's the wankster when you need him?

Tue, 03/29/2011 - 14:57 | 1113739 myTPisUSD
myTPisUSD's picture

"do not try to play the markets, its impossible, only try to realize the truth"

"what truth?"

"there is no market

"there is no market?"

"then you will see its not the market that bends, but only the Bernanke"

Tue, 03/29/2011 - 13:58 | 1113483 unwashedmass
unwashedmass's picture

wait, amend my last comment. i say ben goes when he's got his plane out on the runway...fully loaded with whatever gold this country has left......

Tue, 03/29/2011 - 14:02 | 1113503 NOTW777
NOTW777's picture

guess mu barack got away with his gold - nothing more is heard

Tue, 03/29/2011 - 14:15 | 1113575 Long-John-Silver
Long-John-Silver's picture

Gold plated Tungsten is $16.98 an ounce today.....

Tue, 03/29/2011 - 13:59 | 1113488 digalert
digalert's picture

this time it really is done with QE2

Built on and improved for punch, welcome QE3 the beginning.

Tue, 03/29/2011 - 14:00 | 1113493 ShankyS
ShankyS's picture

"Just pull it."

Tue, 03/29/2011 - 14:18 | 1113578 thedrickster
thedrickster's picture

Pipe down Larry, the BBC isn't yet ready.

Tue, 03/29/2011 - 14:01 | 1113505 LowProfile
LowProfile's picture


Whopping $2.2 Billion In Liquidity Taken Out Of Market



Tue, 03/29/2011 - 14:19 | 1113582 asteroids
asteroids's picture

At this rate it'll take Ben more than 4 years to shink his balance sheet to something reasonable. He's got to crank it up to $20B per day to make things right. At least.

Tue, 03/29/2011 - 14:48 | 1113705 bbq on whitehou...
bbq on whitehouse lawn's picture

You are correct (imho) to question this contraction. Im not sure myself if this was more then accounting magic.

We need to wait for the data on this repo as we do on so many other 'impacts'.

When these repo's impact bonuses and employment we will know truly its 'truthfulness'.

Tue, 03/29/2011 - 16:02 | 1114007 Jim B
Jim B's picture

WOW! 2 whole billion!!!!

Tue, 03/29/2011 - 17:09 | 1114409 alfred b.
alfred b.'s picture


  Wow indeed.....that's just lunch money, without tip !!!



Tue, 03/29/2011 - 14:01 | 1113507 LawsofPhysics
LawsofPhysics's picture

Sorry, the "movie" still has all the same players, directors, and screenwriters.  Nothing has changed.  A whopping 2.2 billion, really?  How much did they monetize last week alone?

Tue, 03/29/2011 - 15:37 | 1113913 Popo
Popo's picture

Bernanke's efforts to seem hawkish are nothing short of laughable. The man must believe he has some credibility left. 2.2 billion? Oh noes!

Tue, 03/29/2011 - 14:04 | 1113508 Yikes
Yikes's picture

Am I reading the summary right: A 1 day Reverse Repo?  Well gee, I guess Ben was right when he said he was 100% confident he could pull liquidity out of the market when the time came. What more proof do you need.


[shaking head] A 1 day Repo.  Winning!

Tue, 03/29/2011 - 14:10 | 1113541 depression
depression's picture

And people still doubt the Bernankster !

Pump $600 Billion in, and drain $2 Billion out !

Tue, 03/29/2011 - 14:44 | 1113675 MarketTruth
MarketTruth's picture

EXACTY as the USA gov spends over $2000 billion a year yet are claiming to be cutting a 'big' decrease of $61 billion. Normally this would be a joke, yet those of you stuck within the USA will be paying the piper sooner rather than later.

Tue, 03/29/2011 - 14:46 | 1113677 MarketTruth
MarketTruth's picture

ZH hiccup

Tue, 03/29/2011 - 14:46 | 1113689 MarketTruth
MarketTruth's picture

ZH hiccup 2

Tue, 03/29/2011 - 14:05 | 1113520 PunkSgt
PunkSgt's picture

what is TOMO?

Tue, 03/29/2011 - 14:06 | 1113534 AlaricBalth
AlaricBalth's picture

Temporary open market operations

Tue, 03/29/2011 - 14:15 | 1113572 NotApplicable
NotApplicable's picture

Because as we all know, there is no way that operations draining liquidity can be made permanent.

Tue, 03/29/2011 - 14:09 | 1113548 mynhair
mynhair's picture

Temporary Open Manglement Operation

Tue, 03/29/2011 - 14:15 | 1113570 AlaricBalth
Tue, 03/29/2011 - 16:01 | 1114000 moriarty
moriarty's picture

Thanks for my on going education. One day i may be up to speed

Tue, 03/29/2011 - 17:52 | 1114594 NonAggressionPr...
NonAggressionPrinciple's picture

...by the time i understand modern finance there will no longer be modern finance..

Tue, 03/29/2011 - 16:17 | 1114105 Regular Guy
Regular Guy's picture

Thanks for the link. Great information.

Tue, 03/29/2011 - 14:17 | 1113586 Byte Me
Byte Me's picture


Bloke who sings "It's not unusal.."

Tue, 03/29/2011 - 16:47 | 1114277 Fistfull of wor...
Fistfull of worthlessDollars's picture

Turd Obfuscating Market Openness

Tue, 03/29/2011 - 14:12 | 1113546 Boston
Boston's picture

"It seems that Fed is doing all it can to telegraph that this time it really is done with QE2. In other words 2011 is not 2010, when this movie ran the last time around..."

Yeah, but what about QE Lite? That looks like it will continue.

And if/when the SHTF (and OK, the pain threshold could be much higher this year), then QE3 will be announced.  America's investing public will demand it.  The Fed will ride to the rescue and voila, the reflation trade will begin anew.

Tue, 03/29/2011 - 14:14 | 1113571 ehildret
ehildret's picture

The fed's play to save face is to blame the crash/dollar demise on Congress/Treausry when they start screaming for more QE (heroin) thus; crash and dollar demise to be laid at the feet of congress.

Tue, 03/29/2011 - 14:11 | 1113549 FunkyMonkeyBoy
FunkyMonkeyBoy's picture

I love the way they have gold pegged down like a muzzled dog.

Tue, 03/29/2011 - 14:33 | 1113639 Yardfarmer
Yardfarmer's picture

take consolation Monkey Boy, apparently Au has a lot more potential downside than most of us think, and infinitely more upside.http://www.martinarmstrong.org/files/how%20and%20when%2003-01-2011.pdf

Tue, 03/29/2011 - 14:52 | 1113704 falak pema
falak pema's picture

Gold is like the muzzled dog...It's the PDs who decide if and when he gets unleashed, as their spear carrier at the FED can manipulate the markets using their PD channels to counter small investor movements, however rational, by blocking it massively in parallel, paper PM markets controlled exclusively by them; false flag trick per se. Only when the market tsunami unfurls, that's when the FED/PD barrier folds in, like in reality...But we're not there yet...Benocide is still king of the heap...The Bastille is still Versailles...it's not yet toast. According to Ben it'll never be. That's the current FED mantra!

Tue, 03/29/2011 - 14:50 | 1113720 Bam_Man
Bam_Man's picture

"Pegged down" like a beachball under water.

Tue, 03/29/2011 - 14:11 | 1113551 defn8Dog
defn8Dog's picture

Maybe clips of Wiley Coyote off-the-cliff will be featured while it's still funny.    

Tue, 03/29/2011 - 14:14 | 1113560 ehildret
ehildret's picture

I think I read somewhere that Gross was going to start buying the MBS from the fed, for pennies on the dollar.  Could be PIMCO was the buyer of the MBS today...  just thinking 

Tue, 03/29/2011 - 14:12 | 1113561 strannick
strannick's picture

Since you guys are in an explanatory mood, what the @#%& is a Reverse Repo?


Tue, 03/29/2011 - 14:25 | 1113604 AlaricBalth
AlaricBalth's picture

From FRB NY:

The Fed uses repurchase agreements, also called "RPs" or "repos", to make collateralized loans to primary dealers. In a reverse repo or “RRP”, the Fed borrows money from primary dealers. The typical term of these operations is overnight, but the Fed can conduct these operations with terms out to 65 business days.

  • The Fed uses these two types of transactions to offset temporary swings in bank reserves; a repo temporarily adds reserve balances to the banking system, while reverse repos temporarily drains balances from the system.
  • Repos and reverse repos are conducted with primary dealers via auction. In a repo, dealers bid on borrowing money versus various types of general collateral. In a reverse repo, dealers offer interest rates at which they would lend money to the Fed versus the Fed’s Treasury general collateral, typically Treasury bills.
Tue, 03/29/2011 - 14:33 | 1113632 Shell Game
Shell Game's picture

Helpful, thanks.

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