Bad Treasury Auctions, January 2024 Edition

Zero Hedge reports on just about every auction of US debt, short and long-term.  You can also track it directly at the US Treasury website.  As readers know, I am currently obsessed with our debt disaster, which I think is far past the tipping point to being irrecoverable.  So I watch these auctions carefully.  The very short term ones, two years or less, haven’t been dreadful.  Any longer maturity is a completely different story.  And yesterday’s 5 year note auction was spectacularly bad.  The amount was $61 billion which is staggering in itself.  As I have been saying, it looks to me like supply and demand are the determining factors now in the rates on the longer-term instruments, not whatever the Federal Reserve tries to set rates at.  And buyers just aren’t that interested in this product.  The end yield was 4.055%, well above what the Treasury planned to sell them at.  The bids to amount offered ratio was bad and dealers were left holding the bag on a large part of the auction. Trillions in new and rollover debt will be issued this year and we can expect more auctions like this one.  (ZH Post)