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Rubicon Associates is headed by a Chartered Financial Analyst with over 20 years of experience in the investment management industry focused on the analysis, investment and management of fixed income and preferred stock portfolios. Over the years, he has analyzed and invested in both public and... More
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  • FOMC - Twisting In The Wind 2 comments
    Jun 20, 2012 11:18 PM

    From the FOMC release:

    On June 20, 2012, the Federal Open Market Committee (FOMC) directed the Open Market Trading Desk (the Desk) at the Federal Reserve Bank of New York to continue through the end of the year its program to extend the average maturity of the Federal Reserve's holdings of Treasury securities. Specifically, the Desk was directed to purchase Treasury securities with remaining maturities of 6 years to 30 years and to sell or redeem an equal par value of Treasury securities with remaining maturities of approximately 3 years or less. The continuation of the maturity extension program will proceed at the current pace and result in the purchase, as well as the sale and redemption, of about $267 billion in Treasury securities by the end of 2012.

    The FOMC also directed the Desk to continue reinvesting principal payments from its holdings of agency debt and agency mortgage-backed securities (MBS) in agency MBS, and to suspend, for the duration of the maturity extension program, rolling over maturing Treasury securities into new issues at auction.

    Come on Benny let's do the twist
    Come on Benny let's do the twist
    Take long duration bond and go like this
    Ee-oh twist Benny baby twist
    Oooh-yeah just like this
    Sell the front end of the curve and do the twist

    The Treasury is sleepin' and Obama ain't around
    Yeah Congress is sleepin' and the Senate ain't around
    We're gonna twisty twisty twisty
    'Til we burn our fiscal house down
    Come on and twist yeah baby twist

    Come on Uncle Sam and do the twist

    Yeah you should see my trading desk
    You should see my my trading desk
    It really knows how to rock
    New York knows how to twist
    Come on and twist yeah benny twist
    Oooh-yeah just like this
    Manipulate the markets and do the twist
    Yeah rock on now
    Yeah twist on now
    Twist

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Themes: FOMC, treasury
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Comments (2)
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  • jbzw
    , contributor
    Comments (647) | Send Message
     
    With apologies to Joey Dee and the Starliters, this gig is no Peppermint Twist.
    21 Jun 2012, 10:06 PM Reply Like
  • Rubicon Associates
    , contributor
    Comments (1793) | Send Message
     
    Author’s reply » No, it certainly isn't. The funny thing is that by trying to help housing, they kick the banks in the teeth IF they can flatten the curve (wish 'em the best of luck). Mike
    21 Jun 2012, 10:59 PM Reply Like
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