Daily Treasury Statement Charts Update: 18/4/11
An update of the daily treasury statement charts for 18/4/11:
The total operating balance of the US Treasury rose by around $29 billion on Friday (latest). Markets were hit hard; with virtually everything falling (bar the dollar, US Government securities and the Japanese yen). As mentioned here, the US Treasury are unwinding their MBS portfolio – around $1 billion was deposited from the proceeds from MBS sales on Friday.
The lagged daily treasury statement charts (see below) continue to suggest that an up-trend might persist for three to four weeks. As always, I warn that this interpretation could be deemed to be alchemistic in nature. Even if past correlations continue for some time, we should note that this run might be a ‘final move’. For those just stumbling onto this site: The broad thesis is that net government spending is bullish for asset prices (on a lagged basis) and net accumulations of cash are bearish for asset prices (on a lagged basis). For a more detailed interpretation of these charts see here.
Recommended: Charting the Federal Reserve's Assets - 1915 to 2012