The Treasury began its massive paydowns starting with $11 billion on the weekly bills today, to be followed by another $32 billion in net payoffs of Cash Management bills tomorrow. The Fed not only did not drain any of that off, they added a net of $3.3 billion via $9 billion in 14 day repos and $7.25 billion in 4 day repos, plus $1.329 billion in an outright coupon purchase, against $14 billion in expirations. The pigmen let out a “Huzzah!” and shouted, “Let’s get this party started!” Click here to download complete report in pdf format (Professional Edition Subscribers).

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