Look like we are going to relive the month of February
30 Year Treasury Auction Is Catastrophic
Stopping at a high yield of 1.940%, the auction was slightly below last month's 2.049%, but it was supposed to be far better, because while the When Issued traded at 1.888% the auction tailed by 5.2bps, which was the biggest tail on record for the 30Y tenor. The bid to cover of 2.202 was far below last month's 2.360 and below the six auction-average of 2.292. But it was the internals that were ugliest of all, with Indirects taking down just 59.0%, a collapse from last month's 70.55% and far bleow the recent average of 64.3%. One has to go back to November 2019 to find a lower Indirect takedown. And with Directs also sliding to just 15.8%, the lowest since October 2020, Dealers were left holding on to 25.23%, the most since August 2020.
the Fed is still unclear what is going on, this is the market - nearly a year before the Fed has to hike rates - tantruming and making it clear that it will not buy paper anywhere close to current levels if the Fed indeed abandons its QE commitment and subsequently hikes rates. Brace for far, far uglier auctions in the coming months from a market that is now fully habituated to getting everything it wants from the Fed. And yes, it will get another QE, it just has to wait a bit until stocks drops 10% or so before Powell throws in the towel.
Stopping at a high yield of 1.940%, the auction was slightly below last month's 2.049%, but it was supposed to be far better, because while the When Issued traded at 1.888% the auction tailed by 5.2bps, which was the biggest tail on record for the 30Y tenor. The bid to cover of 2.202 was far below last month's 2.360 and below the six auction-average of 2.292. But it was the internals that were ugliest of all, with Indirects taking down just 59.0%, a collapse from last month's 70.55% and far bleow the recent average of 64.3%. One has to go back to November 2019 to find a lower Indirect takedown. And with Directs also sliding to just 15.8%, the lowest since October 2020, Dealers were left holding on to 25.23%, the most since August 2020.
the Fed is still unclear what is going on, this is the market - nearly a year before the Fed has to hike rates - tantruming and making it clear that it will not buy paper anywhere close to current levels if the Fed indeed abandons its QE commitment and subsequently hikes rates. Brace for far, far uglier auctions in the coming months from a market that is now fully habituated to getting everything it wants from the Fed. And yes, it will get another QE, it just has to wait a bit until stocks drops 10% or so before Powell throws in the towel.
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风光3265 : @Tupack H McsnacksIs ccxi still worth the wait
Mcsnacks H Tupack OP 风光3265 : Depends on if you want to double your money. Unless you have somewhere better to invest. I’m all ears. CCXI and CRMD are about the only ones who held up today with the market so far down
Bernard With Bacon 风光3265 : CCXI is almost about to climax...
风光3265 : Then I insist
iamiam : havent we always known they cant raise rates, and if powell wants to keep his job he wont stop printing and giving the wolves everything they want. love the posts, thanks mcsnacks
Mcsnacks H Tupack OP iamiam : The stock market is the funding behind all 12 World Banks. That’s why they have the notion of too big to fail. They think they are invincible because 80% of the world depends on that factor.
FlyHighLikeARocket : Master, I saw an article regarding fed will start tapering in Dec 2021. Is this possible?
Mcsnacks H Tupack OP FlyHighLikeARocket : Not enough to notice. They can taper then because December has the least amount of volume.
damnthosegems : What do you think of LBTR or UEC? Ran up crazy this week too
