Crushed under the weight of $48 billion in new Treasury supply, the markets were under pressure again today, including the bond market, where Treasuries erased the effects of Tuesday’s buying panic. Supply will tend to do that, and next week it will only get worse as it looks like the supply wave will build to around $85 billion in new paper.
Meanwhile, the commercial paper market is shriveling as economic activity collapses. The Fed finally began to attempt to counter that with a big buildup in its balance sheet this week, mostly from an increase in TAF and the beginnings of settlements of the previously committed MBS purchases. Click here to download complete report in pdf format (Professional Edition Subscribers). Try the Professional Edition risk free for thirty days. If, within that time, you don’t find the information useful, I will give you a full refund. It’s that simple. Click here for more information.