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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (2483)	11/20/2003 5:45:41 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

This explain what's up. Color me stupid, but why how earth would this Cloherty guy call this a "relief"? Having to have Japan buy up your debt in massive currency interventions is a good thing? Give me a break! Reuters U.S. debt hole plugged by foreign central banks Thursday November 20, 5:02 pm ET NEW YORK, Nov 20 (Reuters) - Foreign central banks bought U.S. debt at the fastest pace in six months in the week to Wednesday, suggesting official purchases of dollars are helping compensate for any lack of demand from private offshore investors. The news should come as a relief to U.S. financial markets, which were roiled earlier this week by figures showing overall foreign demand for U.S. assets collapsed in September. "The reaction to those figures was overdone since it is clear central banks are picking up the slack," said Michael Cloherty, a fixed-income strategist at Credit Suisse First Boston. The Federal Reserve said on Thursday its total holdings of Treasuries and agencies for foreign central banks jumped $16.63 billion to a record $1.022 trillion as of Wednesday, Nov. 19, from the prior Wednesday. That is the equivalent of around 10 percent of U.S. gross domestic product and up from $822.9 billion a year ago. It was the highest weekly rise since mid-May, when holdings were boosted by massive currency intervention by the Bank of Japan. Analysts suspect the latest jump reflects central bank purchases at last week's Treasury refunding, in which the U.S. government sold $57 billion in new notes. "The bidding breakdown had suggested foreign central banks were big buyers," noted Cloherty. "And we expect them to be just as eager at the next refunding (in February)." The breakdown of the Fed's custody holdings showed the central banks bought $11.44 billion of Treasuries, taking their total holdings to $811.12 billion. They also bought $5.19 billion in agency debt, taking those holdings to $210.84 billion. Offshore central banks, mostly from Asia, have been major purchasers of U.S. debt this year as part of efforts to prevent an export-damaging rise in their currencies. Just this week the Bank of Japan was rumored to have intervened to buy up to $10 billion to stop the yen from rising, and analysts assume much of that will end up parked in U.S. debt. If so, it should ensure that the next custody figures will show another big rise. The Fed also released figures that average the daily fluctuations in custody holdings over the week to Wednesday. Those showed holdings rose $11.89 billion to stand at an average $1.014 trillion a day.

To: Crimson Ghost who wrote (2483)	11/20/2003 6:03:41 PM
From: mishedlo	Respond to of 110194

This is absolutely 100% hilarious capitalstool.com

To: Crimson Ghost who wrote (2483)	11/20/2003 6:06:38 PM
From: mishedlo	Read Replies (1) \| Respond to of 110194

The pattern of T-bonds rallying whenever the stock market sneezes has not yet changed. When it does we will be on the verge of one of the biggest bond massacres ever I think. But that still is in the future. Now we are in agreement. Watch us both be wrong! ng Seriously there is a ton of money that will seek "safe haven" when all the safe havens are gone, we pounce big! With futures and options on futures. In the meantime - don't fight the mania Mish