In the Famous Words of Paul Harvey, "And the rest of the story"

Today is a POMO day, just about like every other trading day save 1 or two every couple of weeks as the Fed is busy monetizing as fast as they can before Ron Paul hauls them before the Financial Services Domestic Subcommittee in the House.

And what happens again today? The Fed monetized newly issued debt from the Treasury to the Primary Dealers. In the process the PD's are making millions of dollars. It's a simple and diabolical scheme. the Treasury issues debt, the Primary Dealers soak it up knowing full well the Federal Reserve will buy it from them because lets face it, China voiced it's displeasure with US monetary policy to Hilary Clinton and stopped buying-in steps the PDs and the Fed. Now the downright dirty part which is costing tax payers billions of dollars for literally nothing.

Today the Fed bought treasuries from the Primary Dealers that were just issued January 11th. The PD's are flipping them so fast, they literally have no risk. Each POMO puts millions of dollars in their pockets through the bid/ask spread, the Fed takes on the debt which is effectively monetized and these PD's levitate the market with their 100% risk free capital.

AAPL with it's weight on the NASDAQ 100 Index which is estimated to be around 20% of the index, or about the same as 50 other NASDAQ stocks combined, is the easiest way to lift the market. So it's always fun to watch AAPL around 11 a.m. on a POMO day.

Again, note the time-

The first positive divergence in believable as AAPL has to consolidate after taking the lumps it took this a.m. and since the 5% gain in A.H. yesterday. The second divergence is a leading divergence (stronger) and it's at what time? 11 a.m. right when POMO operations are officially concluded.

The SPY again....

Same time, same divergence. If the DIA/Dow wasn't so ugly we'd probably be going through the roof. But here's te catch, they don't need to go through the roof. Investing several hundred million dollars, they can make a nice profit on a minimal gain, or I suspect if the red phone rings, the nice profit can turn into obscene profits on top of obscene profits.

Really, this is infuriating. If the Fed is going to monetize the debt....



Despite a blatant lie under oath to Congress....

Then just let them buy it straight from the treasury and cut out these PD's that make billions for taking no risk, manipulating the market and costing tax payers billions.