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317 comments on DrumBeat: September 18, 2006

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tate423 on September 18, 2006 - 11:22am Permalink | Subthread | Parent | Comments top
I'm on board with this.  I'm confident we're looking at the beginning of a massive financial catastrophe.  Check out this buried in a bloomberg article discussing Net Foreign Purchases of our T Bills....

http://www.bloomberg.com/apps/news?pid=20601103&sid=afVdECTFx3oo&refer=us

Caribbean banking centers, which some analysts tie to hedge funds, raised net holdings to $68.9 billion.

I tend to believe these aren't hedge funds since no one REALLY knows who it is, but rather the FED going to "extraordinary means", which Ben Bernanke said he would do to maintain the health of the US economy.

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smekhovo on September 18, 2006 - 11:38am Permalink | Subthread | Parent | Comments top
It's probably oil exporters' central banks and investment authorities.
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tate423 on September 18, 2006 - 11:44am Permalink | Subthread | Parent | Comments top
Oil Exporters use London banks to buy their T-Bills.  Central Banks buy direct from the Fed.
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elwoodelmore on September 18, 2006 - 11:53pm Permalink | Subthread | Parent | Comments top
its the u s treasury buying its own debt
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tate423 on September 19, 2006 - 9:35am Permalink | Subthread | Parent | Comments top
I think so too.
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TechGuy on September 18, 2006 - 12:04pm Permalink | Subthread | Parent | Comments top
>I tend to believe these aren't hedge funds since no one REALLY knows who it is, but rather the FED going to "extraordinary means", which Ben Bernanke said he would do to maintain the health of the US economy.

These are hedge funds, tax shelter funds and investment funds of overseas buearcrats funneling money out of their countries. FWIW:$69 billion is a barely a drop in the US Treasury market, and these accounts have been around for a very long time. In 2002 there was about $60 bullion held in the Caribbean.

The Fed can directly purchase and sell treasuries and does so frequently without using offshore banking accounts.

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tate423 on September 18, 2006 - 12:29pm Permalink | Subthread | Parent | Comments top
The Fed can directly purchase and sell treasuries and does so frequently without using offshore banking accounts.

How and where would I find totals for these transactions?  I know that they do sell them, but where do these buy/sells come from in the selling arena?  An intermediary?  I realize all changes are made through the NY trading desk, but again where do these numbers show up?

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Francois on September 18, 2006 - 4:13pm Permalink | Subthread | Parent | Comments top
Part of it is the daily Repo and Pomo markets (google) where the FED allocates temporary of permanent funds for the primary trading banks to support the stock market and/or treasury market.
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tate423 on September 18, 2006 - 5:54pm Permalink | Subthread | Parent | Comments top
Awesome information!  I've googled it and waded through some BS to be quite frank....so I got to this table...

https://www.trading.treasurypoint.com/research/fundlist.asp

Can you help me read this, or can anyone who knows how?

PS-Anyone know why its no auto linky?

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kjmclark on September 18, 2006 - 10:35pm Permalink | Subthread | Parent | Comments top
It looks like secure sites don't work with autoformat. I suppose I've never tried to link with a secure site and autoformat before.

You can always use the html "a rel="nofollow" href=link" to do it.

The link is here.

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fireangel on September 18, 2006 - 10:54pm Permalink | Subthread | Parent | Comments top
Net foreign purhcases has fallen in the past only to rebound strongly. I am a dollar bear but believe me these asian central banks dont learn easily. They love this currency.
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tate423 on September 19, 2006 - 9:38am Permalink | Subthread | Parent | Comments top
Hows this point though?  If the Fed meets and decides this week to lower rates like some are calling for, it's a strong signal that they see bad times ahead.  If they hold rates, they are hoping it doesn affect Net Foreign Purchases, but if they were to raise rates, they can continue selling debt, but the housing sector tanks harder.  We're screwed either way, but it's fun to watch what they value but deflation is their enemy numero uno, so I would think they will print money at some point.
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fireangel on September 19, 2006 - 10:45am Permalink | Subthread | Parent | Comments top
I agree. But dont count the foreigners out yet.Nobody seems to want a strong currency yet. I think that will change when oil starts zooming but for now everybody loves  the greenback.
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Samsara on September 19, 2006 - 3:52pm Permalink | Subthread | Parent | Comments top
If they lower rates the dollar will free fall.

Got Gold/Silver?

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317 comments on DrumBeat: September 18, 2006

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