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Fed Paid Primary Dealers $113 Billion Today And Got Zilch For It

The Fed bought $72 billion in Treasuries and $41 billion in MBS from Primary Dealers today. That’s a month’s worth of old QE in a day. They’ve been doing it every day this week.

The S&P stalled. At 3:50 PM the market was down 73 points, the Dow off 700. Is that shocking? Hell yeah. On Thursday the S&P was up 154. The Fed got about 1.4 points per billion for its newly printed cash.  Today it got nothing. Zero. Zip. Zilch. Nada.

Liquidity moves markets!

Follow the money. Find the profits! 

It’s incomprehensible. $113 billion and the dealers used every penny of it to either pay down debt, buy Treasuries, or just sit and pout because all their money is gone. No house in the Hamptons this summer!

Well fuckem. They deserve it. They have financial engineered the entire world into this graveyard that $113 billion a day can’t even dig us out of. The worst part of this is that we all pay for their sins in the end. Everybody but them. They get bailed out, and next year they’ll get bonuses again.

If you read this yesterday, I’m sorry, but this blows and it’s worth repeating.

Think about it. What impact would this coronavirus have had if banks and corporations had healthy balance sheets, instead of the madness the crooks built up over the last couple of decades.

That’s the reason the system is collapsing, not COVID 19. The virus was just the catalyst. If it wasn’t that, it would have been something else.

I was going to keep track of the Fed’s gas mileage for you. As prices rise, the market will get heavier. There will be more selling, and friction will increase. The Fed’s mileage will begin to suffer.

I did not expect the move to just immediately stall. The engine idled and burned fuel today. But the Fed will fill the tank again on Monday.

Meanwhile here’s the chart of Fed Panic QE versus Treasury supply and the market. This is from Tuesday’s Liquidity Trader report. I update this chart in real time for Liquidity Trader subscribers a couple times a week.

To find out what the Fed’s actions ultimately mean for your investments and trading strategy, join me at Liquidity Trader. I’ll give you the lowdown there on what it means and how to position yourself as a result.

Fed Panic QE and Stock Prices

Here are the results of today’s operations.

Treasuries:

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 02:30 PM
Close Time: 02:50 PM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 03/31/2020 – 06/15/2022
Total Par Amt Accepted (mlns) : $24,000
Total Par Amt Submitted (mlns) : $45,285

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 01:40 PM
Close Time: 02:00 PM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 05/15/2040 – 02/15/2050
Total Par Amt Accepted (mlns) : $5,000
Total Par Amt Submitted (mlns) : $7,855

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright TIPS Purchase
Release Time: 12:50 PM
Close Time: 01:10 PM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 04/15/2021 – 07/15/2027
Total Par Amt Accepted (mlns) : $3,500
Total Par Amt Submitted (mlns) : $7,881

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 12:00 PM
Close Time: 12:20 PM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 06/30/2022 – 08/31/2024
Total Par Amt Accepted (mlns) : $17,000
Total Par Amt Submitted (mlns) : $32,453

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 11:00 AM
Close Time: 11:20 AM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 05/15/2040 – 02/15/2050
Total Par Amt Accepted (mlns) : $5,000
Total Par Amt Submitted (mlns) : $8,598

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 10:20 AM
Close Time: 10:40 AM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 09/30/2024 – 02/28/2027
Total Par Amt Accepted (mlns) : $11,000
Total Par Amt Submitted (mlns) : $22,475

OPERATION – RESULTS
Operation Date: 03/27/2020
Operation Type: Outright Coupon Purchase
Release Time: 09:30 AM
Close Time: 09:50 AM
Settlement Date: 03/30/2020
Maturity/Call Date Range: 03/31/2027 – 02/15/2040
Total Par Amt Accepted (mlns) : $6,000
Total Par Amt Submitted (mlns) : $15,863

MBS:OPERATION RESULTS

OPERATION RESULTS
Operation Date: March 27, 2020
Operation: Purchases
Operation Type: TBA
Auction Method: Multiple Price
Release Time: 02:00 PM
Close Time: 02:30 PM
Settlement Date: April 15, 2020 (April Class A)
Total Amt Accepted (million): $ 6,922 par
Total Amt Submitted (million): $ 10,009 par

OPERATION RESULTS
Operation Date: March 27, 2020
Operation: Purchases
Operation Type: TBA
Auction Method: Multiple Price
Release Time: 01:00 PM
Close Time: 01:30 PM
Settlement Date: May 20, 2020 (May Class C)
Total Amt Accepted (million): $ 8,100 par
Total Amt Submitted (million): $ 10,510 par

OPERATION RESULTS
Operation Date: March 27, 2020
Operation: Purchases
Operation Type: TBA
Auction Method: Multiple Price
Release Time: 11:15 AM
Close Time: 11:45 AM
Settlement Date: May 13, 2020 (May Class A)
Total Amt Accepted (million): $ 6,366 par
Total Amt Submitted (million): $ 8,060 par

OPERATION RESULTS
Operation Date: March 27, 2020
Operation: Purchases
Operation Type: TBA
Auction Method: Multiple Price
Release Time: 10:15 AM
Close Time: 10:45 AM
Settlement Date: May 18, 2020 (May Class B)
Total Amt Accepted (million): $ 2,105 par
Total Amt Submitted (million): $ 2,899 par

OPERATION RESULTS
Operation Date: March 27, 2020
Operation: Purchases
Operation Type: TBA
Auction Method: Multiple Price
Release Time: 09:15 AM
Close Time: 09:45 AM
Settlement Date: March 31, 2020 (March Class A)
Total Amt Accepted (million): $ 17,549 par
Total Amt Submitted (million): $ 20,473 par

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Lee Adler

I’ve been publishing The Wall Street Examiner and its predecessor since October 2000. I also publish LiquidityTrader.com, and was lead analyst for Sure Money Investor, of blessed memory. 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 sales, analytical, and trading capacities. Prior to starting the Wall Street Examiner I was a commercial real estate appraiser in Florida for 15 years. I was considered an expert in the analysis of failed properties that ended up in the hands of bank REO divisions, the FDIC, and the RTC. Remember those guys? 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. I'm not some Ivory Tower academic, Wall Street guy. My perspective comes from having my boots on the ground and in the trenches, as a real estate broker, mortgage broker, trader, account rep, and analyst. I've watched most of the games these Wall Street wiseguys play from right up close. I know the drill from my 55 years of paying attention. And I'm happy to share that experience with you, right here. 

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