$5.6 Billion POMO Completed

Just when you thought the Fed was trying to gradually disintermediate itself from capital markets, they are off to the races with another POMO action. As of this auction, $276.3 of the $300 billion in Treasury repurchase allocation has been used up, leaving less then $25 billion for future POMO actions. As Zero Hedge discussed before, this total will be used up in the next 2 weeks. What then? All of a sudden the invisible bid under equities is looking very, very precarious. 

Notably, of today's POMO, $317 million was used to purchase CUSIP KX7, which is the 3-Year that was auctioned off on June 9, 2009. The bulk of activity ($5.1 billion) was focused on CUSIP LH1.

And here is a graphic representation to either D-Day for equities or to QE 2.0