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aussiebear

World Stock Markets Trading Discussion - Inane input

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18 hours ago, DrStool said:

Jesus - I  missed this yesterday. The Fed increased the overnight repo TOMO to $100 billion from $75 billion. However, that was on top of the $90 billion  in 14 day repos also offered last week.  On Friday, dealers only took a combined total of $71.7 billion. Why?  T-bill issuance was very light this week and will be very light next week.

I admit I don't know much. When I heard  of the first nights repo operation I thought it probably meant that there was some sort of liquidity issue with some player, or two.. Some liquidation was going on somewhere.  I know just enough about this stuff to get into trouble as they say.

While your analysis that systematic liquidity issues were likely because  of  the massive Treasury supply I would guess there is some kernel of truth in my initial idea that some specific player or two  had a problem. Systematic failure never start with total instant collapse but at some weak point and then failures cascade.

Now after 2 weeks nothing that I know of has come out about who may have been suddenly forced to liquidate, Treasury holdings I assume, or something, which caused the huge spike in the overnight market.  That's a long time for a something to stay secret so maybe I am all wet.  Maybe it's more your systematic thing with many players just being squeezed, no accident yet.  

There is a mind-boggling amount of crappy paper out there that is likely less and less 'money good' every day. I don't know how to follow this stuff. I look at the ETF, JNK for junk, and it is holding in there like a champ.  

Also question.  This isn't specifically the Fed Funds market is it? Well I know it isn't.  Did the spike seep into the FF market that night?

 

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ALTRIA AND PMI....EXISTING IN DIFFERENT FRAMES

It seems that my advice has been followed and the merger cancelled.

The problem with merging there companies is that they exist in different frames.

The international regulatory framework is so much more benign for tobacco than the US framework.

They were trying to merge incompatable frames.

Altria needs to get a better grip on the negative frame in which it exists.

The only reason it is tolerated is because the states and federal government need them as a tax cow.

And making cigaretes illegal will merely create a vast black market.

(These simple facts need to be constantly pointed out to the regulators to lessen the pressure)

The great flaw in the agreement they reached with the States and the Fed is that there was no standstill agreement on tax increases.

As the States get more desperate for money expect more taxes and declining sales.

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