$32 Billion 3 Year Bonds Sold At Rate Below 3 Month Libor

Tyler Durden's picture

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TruthInSunshine's picture

There is a whisper rumor spreading around trading desks that Romania is going to bail out the world this time 'round.


Mugur Isarescu has supplanted The Bernank (who really is out of ammo despite his bearded, unscrupulous, blatant lying).

The world looks to Mugur Isarescu.

Poetic injustice's picture

Is he descendant of Vlad Dracula?
Then I would join the believers.

GhostTrader's picture

Do you have reliable sources to confirm that gypsy currency on homemade sucker-candy and soap are about to become newest addition of IMF's SDRs?!

BorisTheBlade's picture
There is a whisper rumor spreading around trading desks that Romania is going to bail out the world this time 'round.
Would be much sexier if Greece stepped up and bailed out Germany, Germany stepped up and bailed out France, France stepped up and bailed out Switzerland, Switzerland stepped up and bailed out Italy, Italy stepped up and bailed out Spain, Spain stepped up and bailed out Portugal, Portugal stepped up and bailed out UK, UK stepped up and bailed out US, US stepped up and bailed out Greece. Bail out circular reference bitches!
Robslob's picture

Enter talking bears for the J6P breakdown!

Flakmeister's picture

Liquidity inversion, bitchez....

GhostTrader's picture

Tyler, whats up with four NetJets ads on one screen?! Times must really be tough if private jet company is targeting ZeroHedge-demographics of unemployed-parents'-basement-living-wanna-be-traders.

Seize Mars's picture

They are the only guys with nonzero net worths!

TruthInSunshine's picture

Brother, times are tough; the stress of the broken markets has caused London traders to go deeply into debt as they need to rachet up their cocaine habits (self medication) to cope, and at a time when they can't really afford to due to uncertainty over their job security.

By the way, they're ordering their cocaine off the menu in 20 of London's poshest pubs & restaurants via coded language:


Markets meltdown leads to surge in City addictions 
The Guardian
"I could take you five minutes from here to 15 or 20 bars where you would be guaranteed to be able to buy cocaine."

Daniel claims there are bars in the City where regular customers order bottles of wine that are not advertised. In fact, these vintages aren't on sale, but are a code for ordering cocaine from bar staff.

"It is all put on the expense account as a £60 bottle of wine, but what the waiters are selling is a wrap of cocaine," said Daniel. "These bars are run by criminal syndicates where the food and drink is incidental. They are fronts for drugs."

Daniel did not disclose the names of the bars he used to frequent, although City-based bar staff have recently been convicted for dealing.

GhostTrader's picture

I am shocked, just shocked. 

SheepDog-One's picture

Brother, can ya spare $50,000 fiatscos?

TruthInSunshine's picture

Bankster Panic on the Streets of London is coming. How bizarre it gets is anyone's guess.

caerus's picture

i need names daniel! names!

indygo55's picture

only three outcomes for using coke. Really. You quit, go to jail or die. Kind of symbolic.


Belarus's picture

For those who prefer empirical evidence, the last time this spread inverted was back in early 2009 before the Fed bailed out the world for the first time (chart 2 below). Now, on the question who bails out the world this time around, with all the central banks "all in" already, we are not too sure. 

It's why having some serious dry powder to get PM's a lot cheap--potentially--is probably a good idea. If everything goes ctrl + sell you can bet we'll see lower paper prices and therefore better accumulation prices for PM's...

oogs66's picture

here is how we will pay for jobs....treasury will borrow money below libor and lend it to banks at libor - all is good!

Spitzer's picture

Not going to happen.

August 4th and that proceeding week was the markets attempt at a 2008 redux and it failed. There will be lots of redemptions, not just from Advanatge plus and these redemptions will, as the trend is indicating, go into physical gold.

The velocity of the trades out of paper and into gold is fast enough that it does not produce a rally in the dollar.

kahunabear's picture

I think retirees are fucked courtesy of Ben the Wanker.

Either they have their 401k in some balanced fund heavily weighted with near 0% bonds that earn nothing and will be destroyed if rates ever rise, or they have a pension on the verge of folding due to high payouts and low returns that will be destroyed if the stock market falls.

SheepDog-One's picture

Retirees are definitely fucked. Ive been doing my best to warn em for a few years now, oh well!

Dr. Richard Head's picture

Perhaps you should show those retirees just one more piece of information. Send them this chart, but free of commentary. 

September 11 – Ten Years Later (Selected Statistics)


It's a great "I told you so"

HedgeAccordingly's picture

everything is fine.. bernanke is making a bunch of 28 year olds rich who trade these products on the short side.. 

Belarus's picture

BTW, Operation Twist isn't going to happen. They already have Twist without having to take the balance sheet duration changes. Plus, Ben already said he saw little evididence it would do anything meaningful. I'm expecting LSAP. It's the only thing that will sort of surprise the market at this point....

monopoly's picture

Yes, senior citizens will soon be paying Bernank to keep their money "safe". This is so insane, yet the dollar rallies as for now it smells the least. I cannot get my brother to either buy some gold or sell his equities, and he is getting old. Man, makes me want to cry.

monopoly's picture

Margin calls hitting soon. Lets see where do they have solid profits, ahhh, the miners. OK, sell them all. Never ceases to amaze.

Spitzer's picture

The dow fell 500 points on Aug 4th and 600 points the next trading day and the gold miners where up 5 to 8%.


order6102's picture

As for what that means we leave the explanation to anyone who believes that a 0.000% on the 30 Year (which courtesy of Operation TurboTorque we may soon see) is perfectly normal. --- its just a credit of EUR banks, and 3y auction never tail.. What it has to do with FED? Just blame a fed for everything, including uncooked breakfast...

bania's picture

Aliens will bail us out, before we go to war with them

fuu's picture

We hate them for their freedoms.

Hero Protagonist's picture

I thought these auctions were going to fail after the removal of QE2?

SheepDog-One's picture

What removal of QE2? We went from QE2 right to QE3+stealth mode and also priced in a trillion for QE4 just for good measure, nevermind where QE3 was going to come from, it wont be delivered in 8 days. 

Good luck...

Dr. Richard Head's picture

Soon to be said by The Bearded One.  He will calm the markets -

“At this juncture, however, the impact on the broader economy and financial markets with the problems in the bond market seems likely to be contained. In particular, bonds sold to primary dealers and mutual funds accouts to all classes of borrowers continue to perform well, with low rates of delinquency.  All that said, given the fundamental factors in place that should support the demand for bonds, we believe the effect of the troubles in the bond market on the broader economy will likely be limited, and we do not expect significant spillovers from the bond market to the rest of the economy or to the financial system, sovereign debt included.  The vast majority of bond auctions, including even bonds sold under the respective Libor rate, continue to perform well.  Past gains in bonds have left most financial institutions with significant amounts of liquidity, and growth in GDP and revenue should help keep the financial obligations of most countries manageable.”

SheepDog-One's picture

Right, in 8 days The Bernank will basically say 'Remember that $3 trillion we priced into equities and bonds since January on every bit of bad news? Well nevermind all that. Thank you and good luck.'

kahunabear's picture

Why are bank preferreds so damn high? Chasing yield? I am amazed how they have hung in there vs. '09.

SheepDog-One's picture

Amazing what zero interest free money flow can do for you!

faustian bargain's picture

I've been under a rock since friday; did Congress raise the debt target--I mean ceiling--yet?

SheepDog-One's picture

No but Negrodamus wants $1 trillion or so free money to play around with....hey Baggerbama gotta get elected you know!

SheepDog-One's picture

8 days and counting until the QE3 which has been baked-in God only knows how many times into equities since January up to todays 'QE rumor rally' must be delivered. That can has already been kicked twice, I cant wait to see the highlight reel faceplant from the FOMC '2 day' special.

LIESman this morning said it has to be $2 trillion at least that falls from the bearded clams face....yea right, we'll see.

jimmyjames's picture
$32 Billion 3 Year Bonds Sold At Rate Below 3 Month Libor


It sounds to me like Bernanke is losing his fight against deflation-Gold and the miners will decouple from this sell off and show everyone that's it is during deflation that Gold fly's-not inflation as so many believe-

JW n FL's picture



As for what that means we leave the explanation to anyone who believes that a 0.000% on the 30 Year (which courtesy of Operation TurboTorque we may soon see) is perfectly normal. For those who prefer empirical evidence, the last time this spread inverted was back in early 2009 before the Fed bailed out the world for the first time (chart 2 below). Now, on the question who bails out the world this time around, with all the central banks "all in" already, we are not too sure.

The Great American Tax Payer Back Stop?

Considering the Government spends NO! Monies! on re-building the infrastructure of America.. and keeps loading up America with Bullshit Debt Europe and stabilizing China's 1,200%+++ Leveraged Renminbi.. What the Fuck is the point?

We are the Worlds Police..

We are the Worlds Rescue Bank..

"We the People" Back Stop this shitty fucking paper?? It is ALL! just pass thru Risk.. the off the top goes to Wall Street Bankers (Investment Bankers {Gamblers} with your savings) and the Risk is directly passed to "We the People"!

and because the Sheepeople are stupid the Evil ones can steer us into a crash course.. which has been sold to the wanna be's as Austerity and Welfare reform.. all the while Corporate America (Oops I meant Job Creators) continue to get more and more Welfare that Costs the Nation Multiples of what the poor people do.

The Scumbags have sold the other Scumbags a Pipe Dream and the World gets to suffer over yet more greed!

These people are Not responsible enough to handle what they have been charged with.

God may forgive you bottom feeders but I Will NOT!!! That's his job!



SheepDog-One's picture

Oh but suddenly NOW is the time for them 'shovel ready infrastructure and cop jobs', 3 years into The Greatest Depression! How will the Annointed Ones do it? Simple....print a few trillion.


rocker's picture

One of your best works JW.  Keep focus. 

RobotTrader's picture

Gold getting dumped en masse to buy Uncle Gorilla Notes that pay zero interest?

Gimme a break!!!

SheepDog-One's picture

Just to let you know I up-voted.

It IS surreal...the best place to be is zero interest money parking, no doubt soon to be negative interest.

Retirees/pensioners are TOTALY screwed simply for the benefit of a few billionaires who will take no less than a few million more in every bonus check.

rocker's picture

Hey Robo, I would buy BND, TLT before buying any retail stock.  Note: I don't own them either.

The point is simple. The con game ponzi stock market is imploding.  LOL

Silverhog's picture

JPM taking Silver down below $36 if they can pull it off. Paper dump all the way down.

SheepDog-One's picture

Everything now operating now on 0%, well except for YOU who must pay 5% interest minimum to those who pay 0% interest.

Fuck it all....remember that monk who immolated himself? Of course you do, everyone does.  At least he made a lasting statement!

digalert's picture

Everybody jump in

Get your gubmint bonds

While looking at the UST's, don't forget the Club-Med bonds on the cheap.