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80% Of Today's POMO Is Bond Auctioned Off Last Thursday

Tyler Durden's picture





 

We have repeatedly observed and commented on the painfully hilarious, thanks to Ben "the Fed will not monetize debt" pattern of the Fed monetizing the OTR just auctioned off bond in its daily POMOs so there is little we can add here suffice to say that the one CUSIP accounting for over 80% of today's $3.7 billion POMO targeting the 01/31/2019 - 03/31/2020 range, at precisely $3 billion, was 912828UV0. What is 912828UV0? This is the 7 Year bond that was auctioned off last Thursday, and which saw $13 billion going to Primary Dealers (make that $10 billion now). In other news, the Fed Chairman does not, repeat not, perjure himself under oath. Ever.

Today's POMO (which so far hasn't done much to instill confidence in central planning courtesy of yet another no volume stock market levitation):

And the details of the just auctioned off last Thursday 912828UV0 7 Year:

 


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Wed, 04/03/2013 - 11:24 | Link to Comment firstdivision
firstdivision's picture

the end of the ponzi seems to be accelerating

Wed, 04/03/2013 - 11:28 | Link to Comment Winston Churchill
Winston Churchill's picture

The USA is going to need bigger guns.The whole world ,just about, is

now shunning the dollar.

Saudi next.

Wed, 04/03/2013 - 11:41 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

The sad part is that one could share this information with the general American public, which I do quite often, and the glazed over eyes of the American Idle-watcher commence. The system is so deliberately obtuse and confusing that most would not take the time to go down the rabbit hole of asking questions like what is money, what is debt, what is fractional reserve banking or what is a central bank. Even if the answer is given to them it means nothing to their TV-addled minds. Sigh......

Wed, 04/03/2013 - 12:28 | Link to Comment ghandi
ghandi's picture

 

Even MSN is saying to get out of Treasuries:

Bubble bigger than housing:

http://money.msn.com/top-stocks/post.aspx?post=05377db0-dc98-4e76-afe3-a424d5bad7bc

Wed, 04/03/2013 - 12:51 | Link to Comment Bananamerican
Bananamerican's picture

 "...and the glazed over eyes of the American Idle-watcher commence."

to be fair, the POMO updates on ZH are incredibly jargon heavy for Joe-6

Wed, 04/03/2013 - 13:09 | Link to Comment Clowns on Acid
Clowns on Acid's picture

What about Joe-12?

Wed, 04/03/2013 - 13:35 | Link to Comment Cast Iron Skillet
Cast Iron Skillet's picture

hey! where I'm at, beer comes in 20-bottle cases.

Wed, 04/03/2013 - 13:35 | Link to Comment SAT 800
SAT 800's picture

Save yourself.

Wed, 04/03/2013 - 12:54 | Link to Comment smlbizman
smlbizman's picture

hey, maybe these guys are really compassionate..............." lets not tell the poor bastards we are going to crash into that mountain"....your right ben, let them enjoy their final days happy"....thats why i always liked you paul"....thanks ben,..ah, ben can i ? sure paul,..... sure.....

Wed, 04/03/2013 - 13:35 | Link to Comment SAT 800
SAT 800's picture

All parabolas have to start somewhere. The acceleration is barely detectable now; next year? could be easily detectable; along with the inflation.

Wed, 04/03/2013 - 11:25 | Link to Comment Edward Fiatski
Edward Fiatski's picture

"PUBLIC DEBT NEWS"

LOL???

Wed, 04/03/2013 - 11:27 | Link to Comment Lost Wages
Lost Wages's picture

POOMOO is bullshit.

Wed, 04/03/2013 - 11:28 | Link to Comment DeadFred
DeadFred's picture

You didn't expect the primary dealers to hold that trash more than a few days did you?

Wed, 04/03/2013 - 11:43 | Link to Comment Dr. Richard Head
Dr. Richard Head's picture

Shit, PDs hold this garbage for negative days now, the way I see it.

Wed, 04/03/2013 - 11:53 | Link to Comment oleander garch
oleander garch's picture

One wonders what the skim on the six day holding period would be.  Certainly, the rate of return must be astronomical for such a short time frame.  POMO may well be the best investment idea ever for primary dealers.

Wed, 04/03/2013 - 12:42 | Link to Comment Ricky Bobby
Ricky Bobby's picture

Wondering the same thing myself. Why work when you have staff to move 11s and 00s around and credit your account millions. Of course the trick is to have those funds converted into your bonus pool. In addtion the Gov gets to fund all the pork, enrich their  Kronies, hire more bureaucrats, and build a police state. Sweet setup - Whats not to like?

Wed, 04/03/2013 - 14:09 | Link to Comment teolawki
teolawki's picture

I wouldn't hold that shit for six seconds, much less six days.

Wed, 04/03/2013 - 11:27 | Link to Comment optimator
optimator's picture

 

Politicians and Banksters never lie or perjure themselves, they simply mis speak.
Wed, 04/03/2013 - 11:30 | Link to Comment Wakanda
Wakanda's picture

"...Fed Chairman does not, repeat not, perjure himself under oath. Ever."

4eva FiSHeS.

Wed, 04/03/2013 - 11:32 | Link to Comment Glass Seagull
Glass Seagull's picture

 

PD commission circle jerk.

Wed, 04/03/2013 - 11:33 | Link to Comment Urban Redneck
Urban Redneck's picture

So how much free cash money (except to taxpayers) did the bankers pocket in today's round of Flip That Bond for the giant risk they took holding that "risk free" government paper for all of four business days?

Wed, 04/03/2013 - 11:39 | Link to Comment eclectic syncretist
eclectic syncretist's picture

I'd like to dedicate this one to all the Central Banker's out there -

http://www.youtube.com/watch?v=VAt7hK_zKr0

Wed, 04/03/2013 - 11:41 | Link to Comment earleflorida
earleflorida's picture

i really can't wait for this country to lose it's petro dollar status-- the chinese would, and certainly are in time [perhaps in 2014 capture the hegemonic crown] going to make great overlords,... and we as american's can go back to living in happier times not working for dah`man!

Wed, 04/03/2013 - 11:47 | Link to Comment Bingfa
Bingfa's picture

Front running the FED.....

It's all they got.

Wed, 04/03/2013 - 11:52 | Link to Comment Al Huxley
Al Huxley's picture

What else do they need?  Risk free money, practically EVERY FUCKING DAY.  And almost nobody gives a shit.  Just keep tellin' us there's no inflation and we're all doin' great, and everything's cool.

Wed, 04/03/2013 - 12:04 | Link to Comment Bingfa
Bingfa's picture

The last refuge of a desperate nation...

From a desperate leader

Wed, 04/03/2013 - 13:33 | Link to Comment SAT 800
SAT 800's picture

Please; neither the shoe-shine boy nor the Hebe money printer are leaders; they're just puppets.

Wed, 04/03/2013 - 13:32 | Link to Comment SAT 800
SAT 800's picture

There;s no inflation until there is; and everything's cool until it isn't. But there really is a long run; as in the banner for this website.

Wed, 04/03/2013 - 11:47 | Link to Comment Political_Savage
Political_Savage's picture

Technically, that's a note, not a bond.

When the Fed is out there buying 80% of OTR 30yr bonds - let me know, weeez screwed

Wed, 04/03/2013 - 11:58 | Link to Comment syntaxterror
syntaxterror's picture

OK, I give up. What does POMO mean? It's used everywhere on this site.

Wed, 04/03/2013 - 12:15 | Link to Comment mortiis
mortiis's picture

Permanent Open Market Operation

Wed, 04/03/2013 - 12:16 | Link to Comment mortiis
mortiis's picture

From:  http://www.newyorkfed.org/markets/pomo/display/index.cfm

 

"The purchase or sale of Treasury securities on an outright basis adds or drains reserves available in the banking system. Such transactions are arranged on a routine basis to offset other changes in the Federal Reserve’s balance sheet in conjunction with efforts to maintain conditions in the market for reserves consistent with the federal funds target rate set by the Federal Open Market Committee (FOMC)."

Wed, 04/03/2013 - 12:18 | Link to Comment Bingfa
Wed, 04/03/2013 - 12:17 | Link to Comment Dollar Bill Hiccup
Dollar Bill Hiccup's picture

Oh come on, that's like a week ago (sort of) that the bond was auctioned off.  Seasoned paper. Ancient history.

Maybe the FED can start locking in POMO buys in advance, before bonds are even auctioned, through a repo structure ... that would be innovative financial engineering. Lend the PD the money to buy the bond from Treasury, and take the bond not yet issued from Treasury as collateral, and then close the repo by buying the bond once it's out for a day or two.

One f-ing bond, 3bn, auctioned a couple of days ago.

As everyone knows that the charade is what it is, either we have a blowoff parabolic top in markets, or ... we have a blow off parabolic top? Bad Europe and China keep Benny's foot down.

Like driving a hot rod Lincoln.

Wed, 04/03/2013 - 13:39 | Link to Comment Cast Iron Skillet
Cast Iron Skillet's picture

... them telephone poles look like a picket fence ...

Wed, 04/03/2013 - 12:21 | Link to Comment Confundido
Confundido's picture

It looks like the only volume is in fiat gold sales....

Wed, 04/03/2013 - 12:24 | Link to Comment southerncomfort
southerncomfort's picture
Permanent OMOs: Treasury

The purchase or sale of Treasury securities on an outright basis adds or drains reserves available in the banking system. Such transactions are arranged on a routine basis to offset other changes in the Federal Reserve’s balance sheet in conjunction with efforts to maintain conditions in the market for reserves consistent with the federal funds target rate set by the Federal Open Market Committee (FOMC).

 

 

The name Pomo derives from a conflation of the Pomo words [p?o?mo?] and [p?o?ma?].[1] It originally meant "those who live at red earth hole"  ... they're screwin' the world's red earth hole bubby.

http://en.wikipedia.org/wiki/Pomo_people

 

Wed, 04/03/2013 - 12:25 | Link to Comment 100pcDredge
100pcDredge's picture

The Fed is mighty indeed... Just look at their HQ: http://farm3.static.flickr.com/2355/2653046208_38d11e63d3.jpg

Wed, 04/03/2013 - 13:10 | Link to Comment Clowns on Acid
Clowns on Acid's picture

As I have said previously....the Fed is going from crazy to immoral.
Rand Paul and his cohorts have to begin bringing this immoral / illegal/ unconstitutional destruction of the underpinnings of the US socio-economic order, to tyhe MSM and indeed the floor of Senate / House.

Wed, 04/03/2013 - 13:30 | Link to Comment SAT 800
SAT 800's picture

So yourr thesis is that once they were "moral"; and when was this, exactly?

Wed, 04/03/2013 - 13:27 | Link to Comment SAT 800
SAT 800's picture

Short the US Treasury Bond contract on the CME from 145.03; for a few days now. Short the ES, (mini-S&P from 1554 for a week or so); went long Dec. Silver this morning at $27.07; one contract. The margin is up at $10,750 or so. Making money in long Cattle, short Corn. Selling another EUR/USD contract this morning; have been short since 1.31.63; looking for some serious re-adjustment in this puppy. Update; now have two contracts short the EUR/USD with a center position at 1.30065. The worse they fuck it up; the more money I make; basically betting on human sutpidity and greed; and here's the best part; my stop loss is at 1.300. I can't lose anything.

Wed, 04/03/2013 - 13:28 | Link to Comment SAT 800
SAT 800's picture

The Silver purchase was motivated by the sharp down-spike in prices, and studying the COT.

Wed, 04/03/2013 - 14:45 | Link to Comment Hubbs
Hubbs's picture

Obviously, no one really cares, because in a way, it is a moot point. The FED is buying up all (80%?) the treasury (debt) auctions as it is. What does it matter whether  it is printed yesterday or today?

 

In the end, when the threshold is reached, i.e the limit of the printed "straw" that "breaks the camel's back", it matters not (except maybe causing the collpase a few days earlier , as indeed we are talking about mere straws on top of the bales and bales of straw already on the poor beast's back.)

Wed, 04/03/2013 - 17:16 | Link to Comment EZYJET PILOT
EZYJET PILOT's picture

Are these Primary Dealer scumbags getting much more for these Treasuries than what they paid for them? How is it possible that they buy them off the UST then sell them for a profit at the fed? Is it just a simple case of paying the banks over the odds, or is the profit because the banks borrowed the money off the Fed at 0% to buy the T bills? I guess it's too late in the game to be learning these basics, what with the collapse just around the corner and all...

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