*SCALPSWINGSTRADDLE*

[mikeg]

Streettalk Live HERE COMES THE POMO PUMP! While the financial media trumpeted the dismal July Existing Home Sales as the prime reason for the early stock market carnage, the reality is SPUs tanked during European trading.A rumor that a ‘large macro fund’ had blown up contributed to the European decline.Merrill saved the market by buying 1200 SPUs af...ter they broke 1050. The reason for the spike bottom in SPUs is the NY Fed injected $1.35B of ‘permanent’ reserves (POMO - Permanent Open Market Operations) into the system, ostensibly to prevent stocks from tanking…Please note the release time of the NY Fed announcement. SPUs bottomed at 10:01 ET. Prop traders and wise guys knew about the scheme well before results were posted.

Permanent OMOs:
Treasury Operation Date: 08/24/2010
Operation Type: Outright Coupon Purchase Release
Time: 10:15 AM
Close Time: 11:00 AM
Settlement Date: 08/25/2010
Maturity/Call Date Range: 02/15/2013 – 07/31/2014
Total Par Amt Accepted (mlns) : $1,350
Total Par Amt Submitted (mlns) : $17,285