Feds To Hear Out Treasuries Players Re: Transparency, Then Do What They've Already Decided Anyway

Steve Mnuchin’s boys get points for politeness.
Still just a glimmer in the would-be manipulator's eye. By JHerbstman [Public domain], via Wikimedia Commons

By JHerbstman [Public domain], via Wikimedia Commons

Sometime soon, the U.S. Treasury Department is going to being releasing data on the secondary market in Treasuries. It might be daily, it might be weekly, but whatever the interval, it will be. This does not make the banks that buy one-third of Treasuries at auction before dumping them on the secondary market very happy. Those banks can rest assured that their gripes and complaints and whines will be heard by someone drawing a federal paycheck. Sure, they will be ignored, but their venting will be heard, and you just can’t put a price on being heard in the same way you can, say, put a price on the front-running profits you’ll be losing.

Treasury is expected to meet this week with New York-based trading firms followed by another set of meetings next week in Chicago, two people familiar with the meetings said. They have already met with each of the 23 primary dealers that participate in U.S. government bond auctions overseen by the Federal Reserve, a third person said….

The meetings aren’t intended to solicit support or ensure any kind of consensus about the benefits of this kind of disclosure, said a head Treasury trader at a primary dealer firm. “They’re going to do this—they just wanted to know what we think,” the trader said, adding he believes Treasury officials have decided the move would make markets more efficient.

Treasury Meets With Banks, Trading Firms As It Weighs Releasing More Market Data [WSJ]