Fed Announces More Stimulus Despite Growing Criticism

The Fed said it would launch a new $400 billion program that will tilt its $2.85 trillion balance sheet more heavily to longer-term securities by selling shorter-term notes and using those funds to purchase longer-dated Treasuries.

 

 

Operation Twist Is Here - Fed To Buy $400 Bilion USTs With 6 To 30 Year Maturity, To Roll Maturities Into MBS

• FED TO BUY TREASURIES WITH 6-YEAR TO 30-YEAR REMAINING MATURITY
  
• FED LEAVES FEDERAL FUNDS RATE TARGET AT ZERO TO 0.25 PERCENT
  
• FED SAYS PROGRAM PUTS `DOWNWARD PRESSURE' ON LONG-TERM RATES
  
• FED TO SELL TREASURIES WITH 3-YEAR OR LESS REMAINING MATURITY
  
• PLOSSER, FISHER, KOCHERLAKOTA DISSENT FROM FOMC DECISION
  
• FED REPEATS `EXCEPTIONALLY LOW' RATES THROUGH AT LEAST MID-2013
  
• FED TO BUY $400B OF LONG-TERM DEBT, SELL $400B SHORT-TERM DEBT
  
• FED EXTENDS AVERAGE MATURITIES OF SECURITIES HOLDINGS
  
• FED TO REINVEST MATURING HOUSING ASSETS IN HOUSING DEBT

 

2s10s, 30 Year Yield Pancakes As Bernanke Sets Off On Bank Carry Trade Deathwish

Congratulations Ben: you succeeded in getting the 30s to a near record low level (and by far the lowest for 2011) , which also means that the entire curve will soon be flat as a pancake, killing Net Interest Margin, aka curve carry for the banks, momentarily. Good bye Bank of America. Have fun riding that bear market rally with no financial leadership for the next several years.

 

 

 

Another Delta One Casualty: Former Goldman ETF Trader Caught In Insider Trading Bust

Just because the correlation trading known as Delta One has not had enough bad publicity, not to mention the firm known as Goldman Sachs, here comes another intersection of the two circles in the most recent Venn Diagram...





QE Can't Save the Day... We've Done a Version of It For Over 10 Years

Posted by: Phoenix Capital...

Post date: 09/21/2011 - 13:01

While most commentators proclaim that QE is a completely new phenomenon, we have in fact seen a version of it in the form of the Fed’s and Asia’s (especially China’s) purchases of US Treasuries/...

Public Schools Face the Rising Costs of Serving Lunch

Eric De Groot at Eric De Groot - 1 hour ago

Higher prices, budgetary cuts, and more federal regulation(s) will be a deadly cocktail for public schools. Headline: Public Schools Face the Rising Costs of Serving Lunch The federal government is making school meals more nutritious this year, but also more expensive. Under a little-noticed provision of the child nutrition bill signed by President Obama in December, which brought more fresh... [[ This is a content summary only. Visit my website for full links, other content, and more! ]] 

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Probabilities of Expected Outcomes Favor Higher Gold Despite Pessimism

Eric De Groot at Eric De Groot - 2 hours ago

Let's consider the following: (1) Spreading activity tends to increase at trend inflections. Gold London P.M Fixed and the Commercial Traders COT Futures and Options ZScore Weighted Average of Long & Short As A % of Open Interest (2) Connected money is aggressively accumulating behind the curtain. Commentary: Headline fear hides gold's bullish money flows Discipline traders/investors... [[ This is a content summary only. Visit my website for full links, other content, and more! ]]

Notes From The Sales Desk: "All Glory Is Fleeting"

Blow up the debt, you blow up the banks. Blow up the banks, you blow up the $700tr derivatives market. Blow up the $700tr derivatives market and the world we’ve known since Bretton Woods changes forever. It’s the same thing that had Hank Paulson corralling senior members of Congress into a wood-paneled room telling them that if he doesn’t get TARP the world will end. He was wrong then and the fear-mongers in Europe are wrong now. Let the banks blow up, let the equity holders get wiped out and the debt holders take haircuts. Guess what? The sun will continue to rise. Sensible, solvent players will move in to pick up the pieces and the real business of healing a horribly broken economy can finally begin but not one second before we force real capitalism down the throats of the current crop of pseudo-capitalists running the world. We’ve had a nice run as the world’s super power. Almost 66 years at the top of the world isn’t too shabby. And no matter what happens during the next few years that would see the US knocked off its perch as sole super power, we will still be an economically important, vital member of the global community. The sooner we acknowledge that the current economic system, that we in the US sit firmly on top of, is broken and needs massive, perhaps even painful fixing, the sooner we can get back to being a great country. In the meantime, the Bernank will tell you how he plans on extending the bad system at 2:15pm. Enjoy.

Guest Post: Daniel Yergin And Peak Oil - Prophet Or Mere Historian?

On 17 September The Wall Street Journal published a fascinating article on “peak oil,” “There Will Be Oil,” written by Daniel Yergin, chairman of IHS Cambridge Energy Research Associates, an energy research and consulting firm and deserved recipient of Pulitzer Prize for his 1991 book, The Prize: The Epic Quest for Oil, Money and Power. According to The Wall Street Journal, “There Will Be Oil” “is adapted from his new book, The Quest: Energy, Security and the Remaking of the Modern World.” The essay will doubtless have widespread influence amongst prosperous The Wall Street Journal readers, but in his glib dismissal of “peak oil” theory advocates, Yergin glosses or ignores a number of issues fundamental to the larger picture, for whatever reason, and these oversights should be considered in any evaluation of the piece and the peak oil “specter.”

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