QE2 is Over

 

 

 

 

by Larry Levin

There were many small bits of news today none of which seemed to matter much.  Since there was a lot, I’ll get right to it.

• QE2 is over.  The Fed’s $600 billion Treasury purchase program has run its course. Who will buy the IOUs now?  Will the PDs have enough cash on hand to keep the Ponzi scheme known as the US government rolling?  Surely it will but won’t be as easy. Ex. This week’s Note auctions were horrible and the Primary Dealers (TBTF banksters) were stuck buying a large portion of them. Since there is no hope that a QE3 will be buying back 7-YR Notes any time soon, the banking mafia DUMPED a whopping 89.7% of those freshly minted 7-YR Notes right back to the Fed – its last chance to do so. The monetization of US debt, whereby the banking mafia temporarily holds the junk so as to somehow “fool” the American public and the dolts in the media, is monetization no matter how it’s done when the holding period of the PDs is just 22 hours like the recent 7-YR Note auction. If they can’t flip them back to the Fed via QE2 - thus having fresh cash from the Fed for high risk trading and new debt purchases – how smoothly will Tax-Cheatin-Timmy’s auctions go in the near future?
• Speaking of Tim Geithner, the tax cheat that runs the Treasury and IRS, rumor has it he may be joining the ranks of the unemployed when Congress agrees to increase the debt ceiling.  Good riddance!
• Speaking of the unemployed, the morning’s weekly Jobless Claims data were horrible – again. This far into the supposed “recovery” the jobs picture never got better and is now getting worse.

• Speaking of the morning data, the ISM was better than expected and who go the news first?  HFT robots – that’s who.  As I mentioned was happening a few days ago, the Chicago PMI will now be “flash released” to the HFT community and this morning it front-ran options like mad. You can read about it here:

http://www.nanex.net/Research/OPRA_063011/OPRA_063011.html

 

• Oil has regained 100% of the drop following the IEA announcement of the 60 million barrel oil dump onto the world market.
• Speaking of an oil dump, I wonder if that was really done for the benefit of an insatiable and well heeled buyer that wanted to make a large purchase: China.
• Speaking of China, it continued to manipulate the Forex market today, specifically the Euro.
• Now that the quarter and QE2 have ended, things may get a little livelier in the markets.

Trade Date: 6/30/11

E-Mini S&P Trades*

(before fees and commissions):

1. No "Secrets" trades filled today.

2. Algorithm positions (4)

3. "Reading the Tape" positions (6) ...combined Secret's, Algo, & "Reading the Tape" total...+0.75 

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