The Treasury Department just announced how much debt it’s going to sell next week. Get a load of these figures: $61 billion in T-bills. $40 billion of 2-year T-notes. $37 billion of 5-year Notes. And $27 billion of 7-year notes. That’s good for a record $165 billion of debt, the most sold in any week ever, driven by increased sales of five-year and seven-year debt. Long bond futures are off about 1 23/32 right now, with 10-year note yields up 11 basis points to 3.8%.
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The Fed announced earlier they would buy 1.25 Trillion of bonds backed by mortgages. Have they published a schedule of when they would do this?
Mike Larson Reply:
June 19th, 2009 at 9:31 AM
You can find details of the Fed’s Treasury and MBS operations at the New York Fed’s website. They publish an advance schedule on their Treasury purchases, but not on their mortgage operations. Here’s the link:
http://www.newyorkfed.org/markets/pomo_landing.html
Largest Ponzi scheme ever.
Acquiring more debt to try and fix the problems caused by too much debt.
It only makes sense in the Land of OZ.
It’s going to take a world war or new productive capacity to get us out of this one. I’m just curious why a country would buy these treasuries? Won’t the Fed just buy these when nobody shows up at the auction? What happens when the Fed buys too many of these and trust is lost. Will the Fed let an auction fail? I smell a global currency on the horizon…
I received a shipment a few weeks back from the US and the value of the package was denominated in the IMF’s currency: SDR. China is already trading in their currency with some of its main trading partners. This will HAVE to affect the overall demand for USD. Why would somebody want a currency backed by bad mortgages and a tax base built on credit inflated consumer consumption (now popping). USD is great for day trading as their markets are liquid, but would not hold long term.
Mike,
Have you been to one of your biggest malls lately? They are packed. No place to park and lots of people inside buying lots of stuff. I think the American public has decided they are not going to accept this recession any more.