The Fed’s own holdings of MBS settled down by $4.671 billion and foreign central banks lurched back into a buying mood, taking on a bit more last week than they dumped the previous week. And speaking of FedMBS, which is the green line in twist’s main busy chart below, doomers should have a close look at twist’s post from earlier today. You can see that the FRBNY is having one heck of a time divesting itself of those legacy bonds from the bubble era, and and its present honour of being America’s third largest (and only large solvent) housing GSE. Perhaps they’ll have to start calling this institution “The Fred” 
This week’s Reuters report1 is, as usual, based on the weekly update from the NY Fed’s H.4.1 table site,2. Here is Doom’s updated CSV version3 of the agencies and treasuries foreign central bank holdings data set.
Treasury Debt holdings alone have now advanced $107.655 billion above their 11/17 ’10 level, but the jury is still out on whether we’re near a top, or if the fast rise will soon resume.
Treasury Debt surged $10.724 billion, more than doubling last week’s selloff.
Agencies continued its losing streak at a reduced pace with a small $1.499 billion drop.
*Agen-FM: The dotted line is the foreign central banks’ Agency Debt holdings reduced by the level of the Fed’s own MBS holdings. Since the FRBNY itself is a lightly audited peculiar amalgam of foreign & domestic, central and private bank I think it might be useful to consider the hypothesis that for a while starting in January 2009 the Fed’s MBS holdings were being quietly deemed to be “foreign.” That is, for the first half of ’09 the dotted line seems more sensible than the red one.
The net of US obligations grew by $9.225 billion, reversing last week’s selloff with more than a billion to spare.
Twist’s ratio graphs dropped.
The Setzer treasuries number number actually took a bit of a dive on a stronger buy at the anniversary, while the agencies number was again flat. We here at Doom Castle think that this yellow line is a pretty good proxy for foreign official support of America’s ongoing bailout habit, and have been following it closely.
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Notes and References
[1]: “Foreign central banks’ US debt holdings rise – Fed”, Reuters, July 21, 2011.
[2]: “H.4.1 Factors Affecting Reserve Balances”, Federal Reserve Statistical Release (weekly), Federal Reserve Bank of New York.
[3]: The updated data set as a Comma Separated Value (CSV) file is here (includes Fed’s own MBS holdings).
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