Liquidity Trader Pro Complete

Reports on the Fed and Treasury, primary dealers, foreign central banks, money market and mutual fund flows, and other factors that affect market liquidity. Includes all reports from Federal Revenues Pro Trader, Macroliquidity Pro Trader, and Treasury Supply and Demand Pro Trader. Click here to subscribe. Subscribers, click the post headline to access reports.

Collapsing Federal Revenues Through February 4 Show US In Deepening Recession

The annual rate of change in withholding taxes has grown increasingly negative in inflation adjusted terms for more than a month. Following on the heels of a weak December, it is a clear sign that the US has entered recession. Other data confirms. As reported here previously, withholding tax collections accurately foreshadowed a negative surprise…

Crosscurrents in Liquidity Pressures and Treasury Supply Don’t Support Rally Continuation

The stock market rallied like a madman at the end of the week and bonds were also in rally mode for most of the week. The question is where the liquidity will come from to sustain a double barreled rally. Negative interest rates are not a genie in a bottle.

Foreign Central Banks Have Left The Building, Leaving Primary Dealers To Blow Up The System Again

The stock market rallied late last week, using up a big portion of the $83 billion that the Fed and Treasury pumped into dealer and investor accounts in recent weeks. Foreign central banks have been dumping their holdings. US commercial banks and Primary Dealers have provided most of the buying. Not only will they and…

Slow Growth Macroliquidity is Effectively Tight Money In Overleveraged Markets

Macroliquidity was little changed last week. The trend is still slightly positive, but slow money growth is effectively tight money in a system overloaded with free interest carry trades. As these trades were one way going in, unwinding them without putting overwhelming downward pressure on the prices of the carried securities to be sold, becomes…

Markets Remain Vulnerable as Cash Windfall Gets Absorbed

The bond market rallied last week, but there’s a big question about who has any real, long term buying interest. Foreign central banks have been dumping their holdings in recent weeks and US commercial banks have been sitting on their hands. However, dealers have bought quite a bit and they leveraged their long positions by…