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Sunday, July 31, 2011

7/31/2011 - 20 Primary Bond Dealers Invited to Secret Meeting With U.S. Treasury

Source: Bloomberg

The U.S. Treasury Department met with bond dealers in New York to discuss next month’s quarterly auctions of notes and bonds and the debt ceiling.

The Treasury canceled its regularly scheduled individual meetings with bond dealers in favor of the group meeting, the department said in a statement today. All 20 primary dealers were invited.
The government is inching closer to running out of cash before an Aug. 2 deadline to raise the $14.3 trillion debt ceiling. House Republican leaders scrapped a vote on the debt ceiling bill late yesterday, fueling concern a compromise by the two parties won’t be reached before the deadline and casting doubt on whether the Treasury can sell more debt.

Officials are “talking to the Street, making preparations just in case they have to reschedule their regular auctions,” said Gary Pollack, who helps oversee $12 billion as head of fixed-income trading at Deutsche Bank AG’s Private Wealth Management unit in New York. “This is a positive sign.”

The meeting was at the Federal Reserve Bank of New York’s headquarters in downtown Manhattan.
“There was a general consensus among all participants that Congress should act as quickly as possible to raise the debt ceiling for as long a period as possible to lift the cloud of uncertainty from the economy,” Treasury said in the statement.

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