Friday, September 10, 2004

THE BENEVOLENCE OF CHINA AND JAPAN


From the FT.com:

A Treasury auction of US government bonds yesterday attracted almost no private demand, creating confusion in the bond markets following a sale on Wednesday that had pulled in unprecedented private appetite.

...Yesterday's surprise collapse in demand added to a sense of unease following unprecedented levels of direct buying in a $15bn auction of five-year notes the day before. Bidders who deal direct with the Treasury usually only amount to about 1 per cent of any auction but on Wednesday, unknown parties took about one-third of the bonds on offer instead of going through the banks, prompting fears that Wall Street could be losing its grip on the market.


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