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Treasuries Fall as U.S. May Announce $60 Billion of Debt Sales
March 4 (Bloomberg) -- Treasuries fell, extending the worst losses in five years, on speculation the U.S. will announce plans tomorrow to sell $60 billion of debt next week as it borrows record amounts to spur the economy.
The “steady drumbeat of Treasury auctions” will send yields higher this year, said Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi UFJ Ltd. in New York. Treasuries dropped even as global stock markets declined, raising concern that increasing supply is overwhelming demand for the relative safety of government debt.
“Supply is pushing yields higher,” said Peter Jolly, head of market research at National Australia Bank Ltd.’s investment- banking unit in Sydney. “As stock markets are making lows, you would have thought that would send Treasury yields lower. I fear the supply concerns are gaining the upper hand.”
The yield on the 10-year note rose six basis points to 2.94 percent as of 1:48 p.m. in Tokyo, according to data compiled by Bloomberg. The price of the 2.75 percent security due in February 2019 dropped 15/32, or $4.69 per $1,000 face amount, to 98 13/32. A basis point is 0.01 percentage point.
Ten-year yields will be between 2.75 percent and 3.25 percent for the next few months, Jolly said, increasing his target range by a quarter percentage point from last week.
Yields, which dropped to a record 2.04 percent on Dec. 18, have averaged 4.64 percent for the past decade.
The U.S. will probably sell a record $33 billion of three- year notes on March 10, $17 billion of 10-year debt on March 11 and $10 billion of 30-year bonds on March 12, according to Wrightson, a research unit of the world’s largest inter-dealer broker. The auctions follow $94 billion of note sales last week.
Fee Rate Advisory #3 for Fiscal Year 2009
FOR IMMEDIATE RELEASE
Washington, D.C., March 4, 2009 — Effective on April 1, 2009, or 30 days after the date of enactment of the Commission's regular appropriation for FY 2009, whichever is later, the Section 31 fee rate applicable to securities transactions on the exchanges and over-the-counter markets will increase to $25.70 per million dollars. Until that date, the current rate of $5.60 per million dollars will remain in effect. The Section 31 assessment on security futures transactions will remain unchanged at $0.0042 per round turn transaction.
A copy of the Commission's Feb. 27, 2009, order regarding the mid-year fee adjustment for fiscal year 2009 is available at www.sec.gov... As explained more fully in the order, the Commission is required to adjust the Section 31 fee rate based on the estimated dollar volume of securities sales for FY 2009. The Commission consulted with the Congressional Budget Office and the Office of Management and Budget regarding the calculation of the mid-year adjustment, as required by Section 31(j)(2) of the Act. The Commission's calculation methodology is described in the order.
Section 31(k) of the Act requires the Commission to continue to collect transaction fees at the previous year's rate until 30 days after the date of enactment of the Commission's regular appropriation for FY 2009. The Commission will publish the effective date of the new rate announced today once the Commission's regular appropriation for FY 2009 is enacted.
The Office of Interpretation and Guidance in the Commission's Division of Trading and Markets is also available for questions on Section 31 fees at (202) 551-5777, or by e-mail at email@example.com.
The Commission will announce the FY 2010 rates for fees paid under Section 6(b) of the Securities Act of 1933 and Sections 13(e), 14(g), and 31 of the Securities Exchange Act of 1934 no later than April 30, 2009. Those rates will become effective on Oct. 1, 2009, or after the date of enactment of the Commission's regular appropriation for FY 2010, whichever comes later.
Guys, YOU need to take this issue VERY seriously.
Just do the math.
Add 1/2% to every trade in terms of cost, or less profit. Think about it from a market makers perspective: Instead of offering a penny spread in the market, the dealer will have to offer at a price which allows him to pay TWO taxes on every round trip. We're very quickly back to the world of eigth's and quater's..... You will not be able to buy things at a penny spread and then, if you are wrong, get out for a few cents. You're hooked on bad longs; and need to have an extended run to make money on 'good' longs. Ditto for shorts!
If you are a day trader, or even a swing trader, you are out of business with this new tax plan!
Sometimes, I wonder if the Administration is trying to get to rock-bottom as soon as possible, so that they can claim that things have been "improving" during the next election. If they think we're inevitably getting there anyway, sooner is better than later, from a political standpoint.
Originally posted by Hx3_1963
reply to post by redhatty
WOW +~400% increase...
Being as buy & hold is underfire right now and day traders are *bearly* holding the market up...this won't be very helpful...
Wonder how long it will take for this to get out to the masses...