Strong Foreign Demand For 30 Year Bonds Concludes Weekly Treasury Issuance

Hot on the heels of the previously discussed surge in Indirect, aka mostly foreign central bank and other official, demand for 3 and 10 Year Treasurys discussed in the past 2 days, the week's issuance was set to end with today's $13 billion in 30 Years bonds. And, as expected, Indirects could barely contain their excitement, taking down just shy of half, or 49.4%, in line with the recent prints of 48.9% and 49.8% in Janury and December, if a little shy of the record high of 53.2% hit in July, after the auction priced 0.4 bps just wide of the When Issued, at 2.56%, a fraction wider than January's 2.43% even if today's session had seen some aggressive buying into the 1pm hour.

The Indirect surge was offset by a slightly weaker Dealer bid, taking down 35.1%, below last month's 37.4%, if in line with the TTM average of 36.9%. This left just 15.5% for Directs.

Finally, while overall the auction was solid, the one place it could have done better was the Bid to Cover which, at 2.26, was below not only the TTM average of 2.46%, but also the lowest since the 2.09 in May of 2014.

Of course, for the S&P the only thing that matters is how quickly this paper can be repoed back to the Fed, so the proceeds can be used to buy AAPL stock either directly, or indirectly, through the next AAPL bond issuance whose proceeds will be used by management for the same effect.

Comments

[Kaiser Sousa]

Dow 18,000.

again.

and then 25,000.

[Creepy A. Cracker]

and then 2,523,000.

Print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print, print....

[SamAdams]

Money fleeing the Euro-Zone and Emerging Market economies.  Those guys have a sovereign debt problem which means the gov't is flipping rocks looking for cash.  So, they park their money in the USA, bonds and stock market.  Causes US deflation, and more importantly, a bubble in US bonds.  And guess what, the USA has a sovereign debt problem too.  But, we will be the last guys standing.  As crazy as it sounds, this is going to drive the stock market up, even without QE....

[ebworthen]

Yup, had that thought this morning.  And Nestle negative rate bonds with strong demand - and corporate bond yields across the board going down which will push more cash into the U.S. equity/bond bubble. 

It's all like a two story stack of fire wood with gasoline being poured on it.  Match?

[Harbanger]

Global Deflation, You can't get away from it.  There aren't many places  to put your money but US equities.  We live in crazyville when buying Bonds means you have to pay them to hold your money.

[sun tzu]

Are you sure? Euro stocks have been going up too, along with the euro

[Wild Theories]

capital that needs to be parked in bonds are quite different in nature from money that can be "invested" in stock markets

[supercelld]

my buddy's ex-wife makes $81 an hour on the computer . She has been without work for nine months but last month her payment was $20924 just working on the computer for a few hours. read the full info here w­w­w.g­l­o­b­e-r­e­p­o­r­t.c­o­m

[Creepy A. Cracker]

Suckers...

[ZH Snob]

I don't know.  why not put soon-to-be worthless fiat into soon-to-be worthless bonds if fiat is what you value to begin with? 

we suckered some folks into believing in that shit.

[madbraz]

to criticize bid to cover and not mention that the auction was for $16 billion, instead of the normal $13 billion, is to be shortsighted or to ignore basic math.

[disabledvet]

This is a massive bubble in paper.

The Army is forward deploying into the East so this whole "we was just foolin" with the sanctions bit is simply ignoring the reality on the ground...namely this fight continues.

In economic terms that says to me a total collapse in the energy complex but we'll see.

Europe is clearly heading into a MASSIVE deflation...and its just a matter of time (March?  April?) before this shockwave hits the US in the form of actual prices.

I'm not sure you can talk down the dollar at this point.  The damage has been absolutely cataclysmic.  

Muni defaults look imminent to me should we get even a bull market correction here ala 1998.

[ebworthen]

Apple about to open a 180,000 sq. ft. facility in Israel.

Cupertino meets Jerusalem?  Odd.

Treasuries = flight to "safety".