Featured Story

$244 Billion of Treasury Debt to Hit the Market Today and Tomorrow as Interest Rates Spike on Ballooning Supply

BanksterCrime:

Upcoming Treasury Auctions

By Pam Martens and Russ Martens,

When Federal Reserve Chairman Jerome Powell held his press conference on May 1 to explain the Fed’s latest policy actions, more than a dozen reporters showed up to ask questions. Those reporters came from every major business news outlet. (See transcript here.)

But on the same date, when the U.S. Treasury’s Assistant Secretary for Financial Markets, Josh Frost, conducted a press conference to announce the details of the Treasury’s plans to issue $125 billion in Treasury debt securities (quarterly refunding), only one reporter from Bloomberg News showed up to ask questions. (See the awkward video at this link.)

Perhaps the U.S. Treasury needs to hire a strong arm like Michelle Smith, Director of Communications at the Fed for the past 23 years, to oversee its press conferences. Or, perhaps a lighter touch would be more welcome. Then again, maybe the U.S. Treasury would rather not call attention to its ballooning issuance of debt.

In addition to the giant pile of debt securities that the U.S. Treasury issues in its quarterly refunding operations, the Treasury also holds ongoing auctions of debt. (See what is being auctioned by the Treasury today and tomorrow on the above chart.)

These auctions will come directly on the heels of the debt markets gagging on $70 billion of a 5-Year U.S. Treasury Note auction and $69 billion in a 2-Year Treasury Note auction – both held yesterday. Treasury yields spiked across the board yesterday, including on the benchmark 10-year Treasury, on the increased supply and in anticipation of more supply about to hit the market.

The additional $244 billion in Treasury debt set to be auctioned today and tomorrow is likely to send more shivers through debt markets as well as in the corner offices of the megabanks on Wall Street. As the chart below shows, the publicly-traded shares of all five megabanks that hold trillions of dollars in interest rate and credit derivatives closed in the red yesterday. Those megabanks are JPMorgan Chase (JPM); Citigroup (C); Bank of America (BAC); Goldman Sachs (GS); and Morgan Stanley (MS).

Not only do these megabanks hold massive bets on the direction of interest rates via their derivative holdings but their securities divisions are also contractually obligated to buy Treasuries at each auction as part of being a “Primary Dealer” to the Fed.

JPMorgan Chase and Goldman Sachs are two of the 30 stock components of the Dow Jones Industrial Average (DJIA), lending a disturbing twist to the definition of “industrial.” The Dow closed in the red to the tune of 216.7 points yesterday while the NASDAQ (COMP), stuffed with tech highfliers reminiscent of the dot.com bubble of the late 90s, closed above 17,000 for the first time.

Throwing gasoline on the interest rate spike were comments made by Minneapolis Fed President Neel Kashkari in a CNBC interview yesterday. Those comments were released in the wee hours of Tuesday morning – well in advance of the Treasury Note auctions. Kashkari said Fed interest rate hikes should not be ruled out. The megabanks and the debt markets have been eagerly anticipating interest rate cuts by the Fed.

At 9:24 a.m. this morning, six minutes before the stock market is set to open, Dow futures were down 252 points, suggesting more spill out ahead from the Treasury debt supply overhang.

Closing Prices, May 29, 2024

Beef in Bulk: Half, Quarter, or Eighth Cow Shipped to Your Door Anywhere within Texas Only

We do not mRNA vaccinate our cattle, nor will we ever!

Grass Fed, Grass Finished Beef!

From Our Ranch to Your Table

Order Today

Loading

Don't Miss

Financial Storm Clouds Gather

By StevieRay Hansen

Greed and a desire for riches are traps that bring ruin and destruction. “The love of money is a root of all kinds of evil,”…

Loading

Read More

Denninger: Economic & Civil Calamity Possible

By StevieRay Hansen

The Bible makes an even stronger statement about the love of money. What we have discussed thus far simply describes the horizontal level of the…

Loading

Read More

These Are The Banks Where The Fed’s $1.4 Trillion In Reserves Are Parked, Big Trouble-Birth Pains

By StevieRay Hansen

Over the past few days there has been much confusion over the repocalpyse that shook the overnight funding market, and just as much confusion over the definition…

Loading

Read More

‘Rogue’ Oil Trader Lost $320 Million On Wrong-Way Derivatives Bets

By StevieRay Hansen

 “Don’t let anyone deceive you in any way, for that day will not come until the rebellion occurs and the man of lawlessness is revealed,…

Loading

Read More

Schiff: The Next Crash Will Bring Down The Fiat Money System

By StevieRay Hansen

These same money changers were associated with others who engaged in shady business practices in the temple courts. Some sold sacrificial animals, overcharging people who did…

Loading

Read More
Posted in

BanksterCrime

Leave a Comment