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Subpar 30 Year Prices At 4.75%, 2 Basis Points Away From Multi-Year Highs

Tyler Durden's picture





 

Unlike yesterday's earthshattering and very perplexing 10 Year auction, today's 30 year auction of $16 billion in bonds was a dud. The bond priced at a high yield of 4.75%, 2 bps wide of the when issued, and just 2 basis points of the highest rates seen in the past several years, specifically the 4.77% seen in the April 2010 auction (not surprisingly, today the 30 Year Fixed Cash Mortgage printed at the highest rate since April of 2010 as well when the market topped last, as we pointed out previously). The Bid To Cover was a subpar 2.51 compared to the 12 month average of 2.67. Direct Bidders, who completely disappeared yesterday were here, taking down 8%, Indirects accounted for 43.1% and the Primary Dealing flippers bought 48.9% (a 73% hit rate). In other news, the interest in the long end is leaking, and the bulk of the fireworks continue to be in the belly, with major interest dropping in the 3-5 Year side, and a major pick up in Indirect interest in the 10 Year. Look for this trend to persist.

 


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Thu, 02/10/2011 - 14:32 | Link to Comment whatsinaname
whatsinaname's picture

Any way to find out who the big players are in the bond market or are the big banks again the power brokers ? Who's to say they are not "playing" the 30 year themselves ?

Thu, 02/10/2011 - 14:40 | Link to Comment asdasmos
asdasmos's picture

Saw this one, Very good article

Thu, 02/10/2011 - 22:56 | Link to Comment Spitzer
Spitzer's picture

We need more Schiff on here

Thu, 02/10/2011 - 14:24 | Link to Comment jus_lite_reading
jus_lite_reading's picture

You know the song! "There's no business, like ho business..." and "There's no better way to get housing off its feet than to cause inflation and rising yields beyond multi year highs..." Or round about how that song went.

Thu, 02/10/2011 - 14:24 | Link to Comment Dixie Normous
Dixie Normous's picture

Who here can break down the expense to the Treasury when the Primary Flippers take these down now, then flip them back during the next POMO?

I mean, how does the fee structure work?

Thu, 02/10/2011 - 14:35 | Link to Comment themosmitsos
themosmitsos's picture

Actually when Tyler posts about POMO or bond auctions he very often includes estimates of cost to taxpayers, tho not detailed fee structure like you've asked for

Thu, 02/10/2011 - 14:46 | Link to Comment I Am The Unknow...
I Am The Unknown Comic's picture

anybody want to venture a guess as to what the POMO dollar figure for this round will be, when it is announced at 2pm?

I'm guessing it will increase from 112 bn to 116-122.  Should be interesting to see if it increases, decreases or remains the same.    

Thu, 02/10/2011 - 15:04 | Link to Comment I Am The Unknow...
I Am The Unknown Comic's picture

WHAT?  Only 97 Bn?  How are the PDs going to prop up the DOW with a measly 97 BN?  Oh wait, they do get an extra 25 Bn a week every Thursday....

I'm just barely smart enough to figure out that's why this POMO round ends on a Wednesday again, and the next round will be announced on a Thursday again, with the following POMO resuming on a Friday (probably again).

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

OOF! Body blow to the monetizer parasites.

Thu, 02/10/2011 - 22:34 | Link to Comment Yen Cross
Yen Cross's picture

Who here understands par? when you answer that we move on one answer will do. hint. 1plus1 equals.

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