LATE UPDATE – The Treasury announced another week of pounding ahead as it plans to dump another mountain of new supply on the market next week. Meanwhile, the Fed again did a big drain in OMO that was more than enough to offset the increase in the TAF. As the Fed feeds liquidity out to the hinterlands via the TAF, it continues to punish the Primary Dealers (PD) by withdrawing the cash to pay for the TAF from the PD trading accounts. The Fed has given no hint of any letup to this policy, which is resulting in shrinkage of the monetary base at a negative 2.5% annual rate. 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.
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