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.

The Cases of The Disappearing Fed Funds Market and the Reappeared Half Trillion

This is an excerpt of a Pro Trader Weekly Macroliquidity service update. Macroliquidity Pro Trader weekly subscribers (or Professional Edition), click here to download complete report in pdf format. The Fed’s liabilities fluctuated wildly last week while total assets were little changed. The wild changes in liabilities were a direct result of the Fed actually supporting,…

Updated- We Need Not Be Rocket Scientists To Understand Supply and Demand

The Bank Treasury Purchases and Primary Dealer Trading sections have been updated with data released late Friday. The Treasury will be paying down another huge slug of Treasury bills next week to avoid going over the debt ceiling. In the process, it will continue to draw down the massive cash hoard it built up over…

Dealers and Investors Show What They Do When Getting $62 Billion in Cash All At Once

We got a demonstration on Friday of what happens when $62 billion in Treasury paydowns hit the market all at once. That was the total cash which the Treasury stuffed back into the accounts of the holders of expiring paper, which they could not roll over because the US Government is up against the debt…

Here’s What Happens When The Treasury Sheet Hits The Fan

Even though a stopgap budget deal was passed this week that will expire on December 11, the  countdown is still on for the Treasury to run out of cash as it bumps against the debt ceiling and has no more accounting tricks in its bag to avoid spending its cash. This week it cut the…

We Have Come To Bury Debt, Not To Praise It

The Fed’s balance sheet went through the normal mid month fluctuations last week as MBS are paid down early in the month and then are replenished at mid month. There has been essentially no change in the total size of the balance sheet since QE officially ended a year ago. And there will be no material change going forward until the Fed either decides to start shedding assets (not gonna do it) or until it restarts QE (somewhat more probable than shrinking the balance sheet).

When Central Banker Economic Delusions Become Everyone Else’s Living Nightmare

The Composite Liquidity Indicator has been inching sideways after hitting a new high during the August 26 week. More importantly, the slope of the line has been nearly flat since January. In this game, if liquidity isn’t growing, that’s tight. Governments are always borrowing more, so if the system isn’t providing new cash to absorb that debt, the cash to pay for the new debt needs to come from somewhere else. That spells liquidation.