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Fed Keeps Monetizing the Debt – 16-Day Bill Treasury Auction Results

This is a syndicated repost courtesy of Treasury Auction Results. To view original, click here. Reposted with permission.

Yes, the Fed keeps monetizing the debt. Just look at today’s Treasury Cash Management Bill auction.

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The Treasury said that it was way oversubscribed. No shit, Sherlock! Since Friday the Fed has pumped $18.6 billion in permanent money into Primary Dealer accounts via POMO outright purchases of Treasuries. Then yesterday and today it rolled about $100 billion in TOMO repos to make sure that money stays in the banking system.

Bottom line: The Fed has been monetizing approximately 60% of the US Government’s budget defecation. That means that the dealers, banks, investors, and the rest of the world need to absorb only 40%. That ratio seems to be enough for the central bank to win the battle to keep the stock and bond market asset bubbles inflated.

Fed Monetizing the Debt

Whether it’s a strategy that will win the “war” remains to be seen.

What a disgusting mess.

Term and Type: 16-Day Bill
CMB: Yes
High Rate: 1.540%
Investment Rate: 1.567%
Price: $99.931556
Allotted at High: 52.15%
Total Tendered: $54,450,259,000
Total Accepted: $15,000,034,000
Auction Date: 11/20/2019
Issue Date: 11/26/2019
Maturity Date: 12/12/2019

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish, and was lead analyst for Sure Money Investor. I developed David Stockman's Contra Corner for Mr. Stockman. I’ve had a wide variety of finance related jobs since 1972, including a stint on Wall Street in both analytical and sales capacities. Prior to starting the Wall Street Examiner I worked as a commercial real estate appraiser in Florida for 15 years. I also worked in the residential mortgage and real estate businesses in parts of the 1970s and 80s. I have been charting stocks and markets and doing analytical work since I was a teenager. My perspective is not of the Ivory Tower. It is from having my boots on the ground and in the trenches of the industries that I analyze and write about today. 

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