Operation Twist Is Here - Fed To Buy $400 Bilion USTs With 6 To 30 Year Maturity, To Roll MBS Maturities Into New MBS

Submitted by Tyler Durden on 09/21/2011 14:35 -0400

Complete Fed Statement breakdown:

• FED SEES `SIGNIFICANT DOWNSIDE RISKS' TO ECONOMIC OUTLOOK
• FED TO BUY TREASURIES WITH 6-YEAR TO 30-YEAR REMAINING MATURITY
  
• FED LEAVES FEDERAL FUNDS RATE TARGET AT ZERO TO 0.25 PERCENT
  
• FED SAYS PROGRAM PUTS `DOWNWARD PRESSURE' ON LONG-TERM RATES
  
• FED TO SELL TREASURIES WITH 3-YEAR OR LESS REMAINING MATURITY
  
• PLOSSER, FISHER, KOCHERLAKOTA DISSENT FROM FOMC DECISION
  
• FED REPEATS `EXCEPTIONALLY LOW' RATES THROUGH AT LEAST MID-2013
  
• FED TO BUY $400B OF LONG-TERM DEBT, SELL $400B SHORT-TERM DEBT
  
• FED EXTENDS AVERAGE MATURITIES OF SECURITIES HOLDINGS
  
• FED TO REINVEST MATURING HOUSING ASSETS IN HOUSING DEBT
• FED SAYS INFLATION `APPEARS TO HAVE MODERATED'
• FED SEES `CONTINUING WEAKNESS' IN LABOR MARKET
• FED PURCHASES TO BE DISTRIBUTED ACROSS FIVE SECTORS
• FED SAYS 32% OF DEBT PURCHASES MATURE FROM 6- TO 8-YEARS
• FED SAYS 32% OF DEBT PURCHASES MATURE FROM 8- TO 10-YEARS
• FED SAYS 4% OF DEBT PURCHASES MATURE FROM 10- TO 20-YEARS

In other words: $400 billion in POMOs over the next 8 months or so, with the monthly at about $50 billion. Also MBS repurchases for a token amount. No LSAP as most expected, and no IOER rate cut. Goldman once again about half of what it expected.