12 days ago I documented the results of the first two auction of the Fed. In the latest auction, rates fell almost a full point.
On January 28, 2008, the Federal Reserve conducted an auction of $30 billion in 28-day credit through its Term Auction Facility. Following are the results of the auction:
Stop-out rate: 3.123 %
Total propositions submitted: $37.452 billion
Total propositions accepted: $30.000 billion
Bid/cover ratio: 1.25
Number of bidders: 52
The simple analysis of the results means that banks like Citigroup (C), Bank of America (BAC), Well Fargo (WFC) and Wachovia (WB) are getting access to capital well below what they can then turn around and lend it.
Disclosure (“none” means no position):Long Wachovia and Citigroup, None
