"In Feb 2013, Fed Will Buy 75% Of New 30y Treasury Supply"

Tyler Durden's picture

We urge readers to read the bolded section below, which comes straight from this quariter's Treasury Borrowing Advisory Committee (i.e., Primary Dealers) presentation to the Treasury Department, and explain, with a straight face, just how the Fed will ever be able to not only stop monetizing debt and injecting $85 billion of flow into the stock market, but actually sell any holdings.

Federal Reserve Holdings (1 of 2)

As of Dec 26, 2012 the Federal Reserve System Open Market Account (SOMA) held approximately $300 billion in 21+ year US Treasury debt

  • SOMA holds 41% of the 30y Treasury bonds issued since 2009
  • In Feb 2013, Fed will buy 75% of new 30y Treasury supply

Twist and QE operations have significantly lengthened the WAM of the Fed’s SOMA portfolio

The Fed currently owns 29% of all marketable 10yr Equivalents outstanding

Full TBAC presentation:

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NoDebt's picture

That's why they call it a "Liquidity Trap".  Very difficult to stop once you start.  Also known as "addiction to printing money."


Meat Hammer's picture

When the only money you have is debt you can't pay off your debt because you would have no money.  

Except for gold and silver.

Seer's picture

Yup!  It was ALWAYS a road to hell.  And now that the growth music has stopped there will be a huge shortage of chairs available.

vote_libertarian_party's picture

How odd.  I thought everything was smooth sailing and hunky doorey.

Water Is Wet's picture

Take that BOND VIGILANTES!  Go Fuck Yourselves!  lololololol


Twat Bernank

dbTX's picture

A Spring time of recovery. Can we get Paul Voulker back on the job?

Liquid Courage's picture

Think he'd take it?

Wanna bet?

Bagbalm's picture

Call us the boot-strap nation.

Racer's picture

Okay so let me see... I am going to print Bank of Racer notes and then I will buy most of them myself..



Uh, no I will do no such thing because it is bad and very stupid

Liquid Courage's picture

And you'd be arrested for fraud if you tried it.

debtor of last resort's picture

So stop calling it "debt".

Everybodys All American's picture

Don't call it taxes either, rather call it revenue. Don't call it spending, rather call it an investment. Such is the case under the Marxist mob serving Obama. Welcome to the world of make believe America. I already know how this ends.

Ying-Yang's picture

Don't call it debt... call it a buying opportunity.

Downtoolong's picture

I think it's interesting that the latest QE has the Fed monetizing both Treasury's and MBS. Like two peas in a pod. That should tell you something about the new risk profile of Treasury's. And the Fed is paying up through the nose for both.  

jomama's picture

the show must go on.

MedTechEntrepreneur's picture

There should be a law forbidding the FED from buying more than 20% of TB's.... This is just an extension of executive and congressional profligate theft.

LawsofPhysics's picture

There was, it was changed sometime before Glass-Stegall.  Can't remember the legislation, for me, the loss of Glass Stegall was the sign to buy any and all physical I could.

hannah's picture

"there should be a law against the fed...'


fixed it for ya...

Poor Grogman's picture

There is..
It's called the constitution.

hannah's picture

what is this 'constitution' you speaketh of...? is it 2-ply or 4-ply paper...?

thismarketisrigged's picture

fuck the fed.


thomas lee from jpm was on cnbc and he said we are in a bull market and that ppl should go long stocks. this fucker does not even mention how its 100 percent due to the fed, prob leading ppl to believe economy is improving.


fuck u lee, hope u and ur fradulant bank get hammered during next crash

news printer's picture
At Vaux, France - workers threaten to blow foundry

168 employees of the foundry DMI de Vaux, in Allier, have disposed gas cylinders throughout the factory and now threaten to blow it up.

HoaX's picture

At least the French know how to put their balls to the wall (potentially literal in this case).

No offense to you guys, but you´re fuckin sheeple.


moonstears's picture

Seems the French need to conscript foundry workers into their military, they'd be a damn force to be reckoned with, having these ballsy fuckers in uniform.

HoaX's picture

lol, they do have the Foreign legion.


Keep downvoting me mates, that will make you feel better. Truly taking a stand you armchair warriors!

earleflorida's picture

what's a 'maginot line got to do with it?

i want a moar... built through it?!

HoaX's picture

Seem like I´m done for now. Pissed you lot off enough for the moment it seems. t(´-´t)

Too easy tho, way too easy.

Btw, keep printing, that will solve it. Almost as much as crying here about the problem for the past 5 years without doing jack shit about it does, or whining about your gold not hitting $1700+

Harbanger's picture

It's very hard to take you seriously with those french dance moves.

Harbanger's picture

Rick Astley is your idea of classics? You're fckin gayer than I thought.

HoaX's picture

Just fuck off will ya.

Btw, your avi makes you look like a fuckin pedo.

What goes around comes around. Least mine knows how to dance.

Stop the avi kiddy abuse.

Harbanger's picture

That's my son when he was 5.  He already had bigger balls than you, frenchie.

HoaX's picture

Why even defend yourself?

Got something to hide?

He already had bigger balls than you

Spare me the details plx you perv.



Boy, that escalated quickly!

jomama's picture

if you meet five assholes in one day, you're probably the asshole.

hannah's picture

those frenchies are DAMN smart. instead of taking over the factory and kicking the owners out, lets blow it up instead. real smart those frenchies....

HoaX's picture

And please tell me, what did you Americans do so far?

Least Europeans know how to send their governments a proper message.

You Americans are a joke, and pissing you off tonight is fuckin hilarious XD

Here´s a nice Russian song to cheer you bitches up a bit :


Major Malfunction's picture

Trololo!!!  Eduard Khil FTW!  That 1976 vid is simply priceless. 


Even though Eduard passed away last year, he will now live on forever.

HoaX's picture

Least someone got a sense of humor, phew!

earleflorida's picture

please... have sum moar hollanddaise'd sauce on your kraut'd sandwich, won't U`

HoaX's picture

How´s your pink slime burger tasting tonight?

Even if you guys wanted to raise a proper insurrection, most of you are too fat to be able to climb out of your Mom sponsored mancave without getting a cardiac arrest.

Fredo Corleone's picture

HoaX !

Speaking of burgers, what the Devil are the Irish doing: selling Polish horse meat to John Bull in Tescos throughout the kingdom ? Quite the controversy...


NEOSERF's picture

So the US this month will buy 75% of our own long term debt, Japan apparently has to buy almost 100% of its debt...nobody except hedge funds wants anything but Southern European debt, Russia is selling US debt and that leaves China...WTF happens if they actually stop buying everyone's debt?  How in God's name do you stop this carousel?  In the past, everyone buying eachother's debt at least gave the illusion of the debt being desired and having value.  No more.  Pretty clear no one wants to buy anything with dates beyond 3 years and therefore no one gets any yield...man is this screwed up.

HoaX's picture

Hedge funds buying European debt should tell you something about the profitability and chance of getting paid back. Do they buy US debt?

China stopped buying yours, and they´re swimming in dollars cuz of all the iCrap they make. They buying PM´s now.

And for some nice watching if you haven´t yet cuz it´s somewhat old:



The truth hurts.

Temporalist's picture

I think, as Hugh Hendry pointed out, China is stuck having to purchase US debt because if they stop they are stabbing themselves in the back as the RMB will appreciate, they won't be able to export anything and they will kill their manufacturing base.  This might change when their growing middle class becomes self-sustaining but they aren't there just yet.

HoaX's picture

Right, it´s totally not like they´re planning to run the worlds reserve currency for the next decade or so.

Harbanger's picture

They're just on board with the globalist plan, but they won't be running anything.

HoaX's picture

Keep dreaming "kiddo".

Liquid Courage's picture

How in God's name do you stop this carousel?


"There is no means of avoiding a final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency system involved."

- Ludwig von Mises

thismarketisrigged's picture

just so i can laugh at the fixation of this market, i hope they bring the s&p positive for the day. it would be too funny not to laugh

optimator's picture

Just half the usual pomo today so It'll have to finish a little red.