Auction Day

Yesterday, US Treasury auctions (incl. today's 24B in 10 Year Notes) were mentioned (hat tip to Paul for the heads up) and this was for a reason.  On a day when Bloomberg trumpets a triumphant and happy sounding piece featuring the words of a Federal Reserve sycophant, we conveniently find markets subdued and gold reversed lower.  Today is for the PTB (as the lunatic fringe call them) to sell their wares.

I was actually wondering why gold had any strength whatsoever the first half of this week, but today's zonk is oh so predictable and lets me know things are as they should be.

Treasury 10-Year Note Yield Reaches 2% Before $24B Sale

But they are not inflating... the chest thumping robot in the previous post said so.

"The U.S. central bank announced Jan. 25 that it will hold its target for overnight bank lending at virtually zero until at least late 2014. Fed Chairman Ben S. Bernanke said policy makers were considering buying bonds to sustain the expansion.

The central bank is replacing $400 billion of shorter- maturity Treasuries in its holdings with longer-term debt to cap borrowing costs and spur the economy under a program it plans to conclude in June.

The Fed is scheduled to buy as much as $2 billion of bonds due from February 2036 to November 2041 today, according to the New York Fed’s website. It also plans to sell as much as $8.75 billion of Treasuries maturing from June to November 2013."

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