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Treasury Offering Net Supply Bulges – The Deluge Begins

The bulge in Treasury offering net supply issuance in the wake of the suspension of the debt ceiling, is starting.

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Let the deluge begin.

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Treasury Offering Net Supply

The US Treasury today announced $90 billion in 4 and 8 week bills to be auctioned Thursday. That includes $20 billion in net new supply to start raising the cash they need to repay the accounts they raided under the debt ceiling.

Commissar Trump signed the Rump Congressional deal to suspend the debt limit last week. Hundreds of billions in Treasury offering net new supply are coming within weeks. While that will eventually moderate some, the supply deluge will stretch as far as the mind can see, and beyond.

The new bills announced today settle August 13. Then $26 billion in net new coupon debt will settle August 15.

The pressure of new Treasury supply on the market will be relentless. We have known ever since the debt ceiling was imposed in March that this day would come and that it would be bad news for the stock market.

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both analytical and sales capacities. Prior to starting the Wall Street Examiner I worked as a commercial real estate appraiser in Florida for 15 years. I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. My perspective is not of the Ivory Tower. It is from having my boots on the ground and in the trenches of the industries that I analyze and write about today. 

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