POMO Purchase Update

The Fed performed another POMO (Permanent Open Market Operations) purchase today.  The Federal Reserve purchases treasuries from the primary dealers infusing cash into the primary dealers (TBTF banks) to pump into the stock market.  It will be interesting to see how the market closes today on the heals of a worse than expected ADP report, the market seems to be holding up quite well so far.  Since August 17th 2010 the Fed has purchased $43.7 billion in U.S. Treasuries.  Per Zerohedge this makes the FED the 2nd largest holder of U.S. treasuries in the world, with a total of $819 billion.  Japan is the largest holder with $821 billion in July of 2010.

Operation 1 - RESULTS

Operation Date:   10/06/2010
Operation Type:   Outright Coupon Purchase
Release Time:   10:15 AM
Close Time:   11:00 AM
Settlement Date:   10/07/2010
Maturity/Call Date Range:   03/15/2013 - 08/31/2014

Total Par Amt Accepted (mlns) :	$2,069
Total Par Amt Submitted (mlns) :	$25,157

Primary dealers as of Jun of 2009:

• Banc of America Securities LLC
• Barclays Capital Inc.
• BNP Paribas Securities Corp.
• Cantor Fitzgerald & Co.
• Citigroup Global Markets Inc.
• Credit Suisse Securities (USA) LLC
• Daiwa Securities America Inc.
• Deutsche Bank Securities Inc.
• Goldman, Sachs & Co.
• HSBC Securities (USA) Inc.
• J. P. Morgan Securities Inc.
• Jefferies & Company Inc.
• Mizuho Securities USA Inc.
• Morgan Stanley & Co. Incorporated
• Nomura Securities International Inc.
• RBC Capital Markets
• RBS Securities Inc.
• UBS Securities LLC

Zerohedge expands on this activity to sum up and do additional comparisons of the FED POMO purchases, you can view this by clicking here.