$5 billion in bonds were called as of November 15, but we already accounted for that in our table. Furthermore, $5 billion in cash hitting the market is far from sufficient to explain this rally in both stocks and bonds. However, we do know that the Fed usually settles big chunks of their MBS purchases during weeks when the Treasury has a load of paper to dump on the market, and this is what I think I smell here- a massive dump MBS settlement. If so, then huge piles of cash are flowing into investment accounts just in time for them to bid up Treasuries and everything else in creation. 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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