Business

Regular readers know Tim Leissner.

Leissner was the powerful Goldman banker responsible for financing Malaysian PM Najib Razak’s giant slush fund, known as 1MDB.

After yesterday's strong 2Year auction, there was some confusion how today's issue of $34 billion in 5 Year paper would transpire, especially after the previously reported "technical difficulties" which prevented the NY Fed from conducting today's MBS POMO - something that has not happened in years. Well, the results are in and the auction was an absolute blockbuster.

Submitted by Claire Bernish via TheAntiMedia.org,

An increasing number of politicians have joined the call for an audit of the Federal Reserve, including several presidential contenders - most surprisingly, Donald Trump.

Just at the market began its torrid ramp higher today at 11:15 am on the dot, something else was expected to happen: the Fed's open market buying, or POMO, of Agency MBS (yes, those still continue despite the end of QE because the Fed has to keep the level of its balance sheet flat and offset maturities).

Only today this did not happen. Instead, this is what the NY Fed said:

Wed, February, 24, 2016

 

A growing number of investors are beginning to realize that Central Banks are effectively out of ammo (for now).

Last week I noted that the Bank of Japan’s implementation of NIRP only generated a brief rally in Japanese stocks.  That rally has since been obliterated as Japanese stocks collapsed 10%.

This collapse has finally prompted the mainstream financial media to question NIRP. It’s a shame no one bothered to question NIRP, ZIRP, and QE when the markets were still rallying!

HSBC: Sweden's Experience Shows Negative Rates Haven't Worked