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Fed Cuts May POMO To Only $24 Billion From $30 Billion

Tyler Durden's picture




 

One hour after announcing that the Fed would, as expected, cut its monthly Treasury purchases, aka stock market liquidity injections to $25 billion (and $20 billion in MBS), the NY Fed released its POMO schedule for the month of May. The key highlights:

  • "The Desk plans to purchase approximately $24 billion in Treasury securities over the month of May. This amount is approximately $1 billion less than the stated pace of $25 billion per month, given that purchases conducted in April exceeded the target by approximately $1 billion."
  • There will be "only" 16 POMO days, down from the usual 18.
  • The largest POMO days will be Monday May 12, when the Fed will inject $2.25-$3.0 billion into the market and Thursday, May 29, when another $2.50-$3.25 billion will be allocated to stocks.
  • There will be no POMO on Wednesday May 7, Thursday May 15, and Wednesday May 26. Needless to say, for those so inclined, these may be the better shorting entry points.

At this pace POMO will be over by December, although expect the market to enter full freakout mode when the Fed is only monetizing a paltry $10-15 billion on about half the days of the month.

 

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Wed, 04/30/2014 - 15:18 | 4713345 NOTW777
NOTW777's picture

and WHO believes this?

audit the fed

Wed, 04/30/2014 - 15:30 | 4713400 maskone909
maskone909's picture

They continue to create straw buyers for purchase of treasuries. There is no taper. There is only insolvency.

Wed, 04/30/2014 - 15:43 | 4713449 NotApplicable
NotApplicable's picture

That reverse-repo must be working wonders for the economy!

Wed, 04/30/2014 - 15:46 | 4713461 max2205
max2205's picture

Good to see somethings don't change

Wed, 04/30/2014 - 16:27 | 4713592 strannick
strannick's picture

Good old Belgium to the rescue

We were there for them in double you eye eye, and they got our backs now. They must've been saving for generations to be buying all these Treasuries...

Wed, 04/30/2014 - 18:32 | 4714030 prodigious_idea
prodigious_idea's picture

Nothing to do with savings.  Euroclear is based in Belgium and supplies Treasuries to hundreds of clients that include institutional investors, clearing houses, central banks and European countries.

Wed, 04/30/2014 - 20:46 | 4714409 Keyser
Keyser's picture

Which boils down to the Fed monetizing the debt, off balance sheet... Oh what a wicked web we weave... 

 

Wed, 04/30/2014 - 15:46 | 4713460 Chupacabra-322
Chupacabra-322's picture

@ maskone909,

Insolvency? We've been insolvent for quite some time.

The Criminality is no longer "hidden in plain veil." It's all now very out in the open for all the world to see. I don't know if you noticed or not but the world is no longer cheering us on.

The Criminal UNITED STATES, CORP. INC, is now the Totalitarian Authoritarian Fascist world power.

Wed, 04/30/2014 - 15:54 | 4713486 maskone909
maskone909's picture

Whats sad is that when American society deterioration accelerates, the UN will probably assume rule of law, and whats left of our constitution will be swept under the rug and the sheep will applaud it.

Wed, 04/30/2014 - 20:51 | 4714431 Keyser
Keyser's picture

By sheeple I assume you mean the useless eaters that inhabit the liberal bastions of our society... I can assure you that there are many, many more that feel this way... 

https://www.youtube.com/watch?v=DVi-cqRG-jY

Wed, 04/30/2014 - 15:35 | 4713417 Event Horizon
Event Horizon's picture

That Belguim proxy will have to pick up the slack

Wed, 04/30/2014 - 15:40 | 4713439 TideFighter
TideFighter's picture

"and WHO believes this?

audit the fed"

AUDIT NOTHING-Would be like checking the pulse of a decapitated man.

Close the fucker down.

Wed, 04/30/2014 - 15:19 | 4713349 NOTW777
NOTW777's picture

this is like a menu for bankers - prices can change but order what you like

Wed, 04/30/2014 - 15:50 | 4713471 VD
VD's picture

it's on the tab....

Wed, 04/30/2014 - 15:22 | 4713355 ebworthen
ebworthen's picture

So they're cutting it by $6 Billion per month?

Sounds like they have some surplus to send me my $3 Million tax free.

Considering the 2009 bailouts to banks/insurers/corporations of $800 Billion five years ago - make it $4 Million (inflation).

Wed, 04/30/2014 - 15:20 | 4713357 Kaiser Sousa
Kaiser Sousa's picture

Full Spectrum Bullshit...

im stackin.

Wed, 04/30/2014 - 15:21 | 4713361 NOTW777
NOTW777's picture

why is it every time they "taper" yields fall?  belgium? what?

Wed, 04/30/2014 - 15:25 | 4713376 i_call_you_my_base
i_call_you_my_base's picture

Rigged.

Wed, 04/30/2014 - 15:36 | 4713425 Rainman
Rainman's picture

I think it's called the central banker reacharound

Wed, 04/30/2014 - 15:43 | 4713450 HpDeskjet
HpDeskjet's picture

No, it's very fucking simple: People buy risky assets (i.e. anything except AAA government bonds), on the promise of more QE. When that liquidity pump slows, they return to their "normal" habitat and sell risky assets. This is putting a cap on interest rates. For now, the liquidity pump is big enough (=> QE > monthly net treasury issuance), so the herd rightly does not consider tapering as tightening. However, from next taper (somewhere beginning june) QE < monthly net treasury issuance, and liquidity is actually tightened in US. Question is will other central banks make up for it? If no S&P will go south hard

Wed, 04/30/2014 - 20:40 | 4714382 new game
new game's picture

foreign buyers, whose econ fucked by inflation export-go figure...

plus there is about 4 trillion extra dollars out and about looking for a place to rest...

Wed, 04/30/2014 - 15:22 | 4713362 spekulatn
spekulatn's picture

Amazing.

 

Wed, 04/30/2014 - 15:23 | 4713365 q99x2
q99x2's picture

Right and the oligarch families working out of brussels to take over the world since WWII are going to buy 54 billion in US treasuries. Basically enough to keep stocks climbing and enough fo fund the DHS to do some serious damage when they pull the plug.

Wed, 04/30/2014 - 15:24 | 4713373 q99x2
q99x2's picture

Our trannies deserve better POMOs.

Arrest the FED for treason.

Wed, 04/30/2014 - 15:27 | 4713381 Seasmoke
Seasmoke's picture

At this point. What is the point ?

Wed, 04/30/2014 - 15:54 | 4713485 Rainman
Rainman's picture

Point is I only got to work 4 Tuesdays next month.

Wed, 04/30/2014 - 15:27 | 4713385 Bernoulli
Bernoulli's picture

Will those people responsible for what will happen to all of us be put to jail one day?

I would hope so.

Wed, 04/30/2014 - 15:32 | 4713407 jubber
jubber's picture

How about the secret POMO? you know the one that sends US futures up  EVERY overnight session when the US Stock market is closed!

Wed, 04/30/2014 - 15:35 | 4713419 fonzannoon
fonzannoon's picture

as long as there is no volume in the market it looks like we can drift towards stock nirvana, even as people pile into bawnds.

Wed, 04/30/2014 - 17:15 | 4713778 NotApplicable
NotApplicable's picture

Just think of how great it will all be once volume hits zero. Why then, even the algos can take a well deserved break!

Wed, 04/30/2014 - 15:50 | 4713472 Yardfarmer
Wed, 04/30/2014 - 16:15 | 4713534 what's that smell
what&#039;s that smell's picture

full freak out mode? gimme a break!

all-time-highs in both DOW and S&P500 on a monthly closing basis.

BTFDOWATH unless you BTFS&P500ATH

 

Wed, 04/30/2014 - 16:44 | 4713671 Fuh Querada
Fuh Querada's picture

POMO again. How's about some PETERO for once?

Wed, 04/30/2014 - 18:29 | 4714019 TalkToLind
TalkToLind's picture

I'm tapering, boss...I'm tapering.  ~Cool Hand Janet

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