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A Sell Off Of Currencies Will Present An Opportunity To Go Long The Inverse ETFs Or Short The Leveraged ETFs

Financial Market Report for October 14, 2010

I … EconomicPolicy Journal reports Bank Stocks Getting Hit in Advance of More Homeowners Stopping Mortgage Payments. Today’s 2.8%  fall in the bank shares, KBE, and 2.0% fall in Nasdaq Banks, QABA, and 5% fall in Bank of America, BAC,  imperils the recent strong rally in stocks. Should the currency traders go short the euro yen carry trade, and others, then there will cause a massive world wide stock sell off.

The Euro, FXE, rose today against the Yen, FXY,  causing the EUR/JPY to rise to 114.58. This is seen in the chart of FXE:FXY trading at 1.15.  The Euro FXE closed at 140.22. And the Yen, FXY, closed at  121.47.

I’ve reported on the Euro, FXE, ever since the European Sovereign Debt Crisis broke out on April 26, 2010, when the currency traders sold the world currencies, and the Euro, against the Yen, FXY; this occurred when the Euro sold off at 132.77.

It was at that time that the small cap pure value shares, RZV, sold off heavily against the small cap pure growth shares, RZG.

The small cap pure value shares, RZV, relative to the small cap pure growth shares, RZG, have started to sell off once again as is seen in the chart of RZV:RZG.

Today’s 1.8% fall in Tax Managed Buy Write Opportunities,  ETW, is a bearish omen. As the fall in Inverse Volatility, XXV.

This  provides the opportunity for one to go long a number of inverse ETFs as carry trades unwind causing disinvestment from stocks.
VXZ,  S&P Mid-Term Volatility, gained 1.5% and  VXX, Volatility gained 3.5%.

Chart of VXZ and VXX

EPV,  200% Inverse Europe …  lost 1.5% today
SRTY, 200% Inverse Russell 2000 … gained 0.42% today
SSG, 200% Inverse Semiconductors … lost 0.07% today
RETS, 200% Inverse Retail … gained 1.20% today.


SOXS, 300% Inverse Semiconductors … gained 0.82% today
LHB, 300% Inverse Latin America … gained 1.29% today.

Chart of LHB, SOXS

The chart of the Russell 2000, IWM, relative to Banks, KBE, IWM:KBE, shows how overextended the Russell 2000 shares are at the current time.  The recovery of the Euro, FXE, and destruction of the US Dollar, $USD, has transferred massive amounts of capital to the emerging markets, like Peru, to Asian markets like Hong Kong, EWH, and Singapore, EWS, as well as to Brazil, EWZ, India, INP,  Switzerland, EWL, China, FXI, and it has swelled, that is inflated the small cap stocks such as the Russell 2000, as well as inflated bankrupt nations like Spain, EWP.  

II … Because the above quickly loose expansion capability and close on the trader, it is better to go short the inverse ETFs;
UBR, ProShares Ultra Brazil — UBR, 200% Brazil xx fell 1.29% today, creating gain to the short seller
UPV, ProShares Ultra Europe — UPV, 200 Europe xx
INDL, ProShares Ultra India — INDL, 200% India xx fell 2.04% today, creating gain to the short seller
RETL, ProShares Ultra Retail — RETL, 200% Retail xx fell 2.44% today, creating gain to the short seller
EZJ, ProShares Ultra Japan — EZJ, 200% Japan xx rose 0.66% today, creating loss to the short seller
URTY, ProShares Ultra Russell 2000 — URTY, 200% Russell 2000 xx, fell 0.08% today, creating gain for the short seller
USD, ProShares Ultra Semiconductors — USD, 200% Semiconductors xx, fell 0.40% today, creating gain for the short seller

Chart of  

The longer out US Government bonds are falling now, as bond traders are concerned that the Fed’s QE 2 is monetization of debt.

UBT ProShares — UBT, 200% US 30 Year Treasury xx fell 2.78% today, creating gain for the short seller  
TMF Direxion — TMF, 300% US 30 Year Treasury xx fell 4.56% today, creating gain for the short seller

Chart of

Tyler Durden reports in ZeroHedge article Primary Dealer Stick Save Prevents Rout: ”PDs took down 58.6% of the auction, the highest since May of 2009″.  And CNBC reports: Bonds Add to Losses After Dismal 30-Year Auction. I relate that currently the 30:10 Yield Curve, $TYX:$TNX,  is quite steep at 1.580. A steep yield curves is typically considered conducive to economic growth and investment, but will today’s artificially steepened curve assist growth and encourage continued investment?

Of note the Zeroes, ZROZ are at the edge of a massive head and shoulders pattern, manifesting a huge bearish engulfing candlestick, this suggests they could fall massively lower in value. As they break lower, then those short TMF and UBT will be nicely rewarded. The interest rate on the 30 Year US Government bond, $TYX, is now in its fourth day of breakout and trading at 38.98.   

In a strange quirk, the TIPS are rising and even more surprizingly the longer out  LTPZ at 58.72 has risen faster in value than the shorter duration TIP.

With bonds, BND, trading at 82.53, the Great World Wide Bond Rally is over. The Bond Bubble has been pricked by bond vigilantes calling  the interest rate on the 30 Year US Government bond, $TYX, and the interest rate on the 10 Year US Government Note, $TNX, higher.  The investor is no long entitled to a growing return of investment in a bond ETF or bond mutual fund. Given that stocks, ACWI, and bonds, BND, turned lower today, we have passed through Peak Wealth. We have passed from the age of prosperity into the age of debt servitude. 

Today, we have passed through Peak Credit.

One can follow a number of Inverse ETFs to be sold short in this Finviz  Screener.

III …  Even better yet is to invest in gold bullion, $GOLD, and take personal possession of the hard asset; it rose 0.52% today as World Stocks, ACWI, rose 0.16% ; and the S&P, SPY, lost 0.39% and the Russell 2000, IWM, lost 0.07%.

Mortgage Backed Bonds, MBB, fell lower to  109.66. Junk Bonds, JNK, manifested a dark cloud covering candlestick at the top of an ascending wedge to close lower at 40.13; this suggests that we have passed through peak investment liquidity.  Municipal Bond, MUB, closed lower at 106.25. Emerging market bonds, EMB, manifested a dark cloud covering candlestick and traded lower at 113.01. Although the US Federal Reserve is communicating a new QE package, the bond market is selling off, as even the short duration US Government Bonds, the 2 Year Notes, SHY, turned down today.

The Fed must have foreseen this day. Promising more stimulus only monetizes sovereign debt, and causes money to take flight to safety in gold, GLD, and to speculate in buying commodities, such as agricultural commodities, RJA, and food commodities, FUD, inflating the price of such to the world’s population. I conclude that the purpose of QE2 is a final chapter in integrating the Banks and the Government into a combine of state corporate rule, that is state corporatism.   

The Spigot of InvestmentLliquidity coming from the Government, being turned past full on, has become toxic to investing long both the bond and the stock markets.

The Spigot of Investment Liquidity coming from the Currency Traders going long the carry trades, can be seen in the major currencies, relative to the Yen, DBV:FXY, and the developing currencies relative to the Yen, CEW:FXY, both turned lower today, suggesting that yen based carry trades will now be unwinding causing disivnestment from stocks.

With both spigots of invesment liquidity being turned off, debt deflation will not get actively underway once again.

Debt deflation is the contraction and crisis that follows credit expansion.  One of the most famous quotations of Austrian economist Ludwig von Mises is from page 572 of Human Action: “There is no means of avoiding the final collapse of a boom brought about by credit expansion.  The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion or later as a final and total catastrophe of the currency involved.”

Global Debt Deflation commenced on April 26, 2010, when the value shares failed to outperform the growth shares.

It was on April 26, 2010, the currency traders went long the yen and short the global currencies with the onset of the European Sovereign Debt Crisis.

Now, once again the currency traders may sell the world currencies against the Yen, in a revulsion of QE2; or they may sell the US Dollar, $USD, the choice is theirs. If someone calls the Yen, FXY, higher over night, that is above 121.47, it is likely that they will sell the world currencies against the Yen tomorrow.

One can use this Finviz Screen of common currency ETFs to establish a currency portfolio to follow currencies FXA, FXE, FXM, FXC, ICN, FXB, FXS, SZR, FXF, CYB, BZF, XRU, FXY, BNZ , DBV, CEW
One can use this Finviz Screener of ETFs to establish a portfolio of common ETFs

One can use this Finviz Screener of ETFs to establish a portfolio of common bonds; I find it weird that TIPs were up today.

One can use this Finvis Screener of Sector ETFs to establish a portfolio to view sector performance;  just about the only sector up today was solar stocks, TAN.

One can use this Finviz Screener to view emerging market performers; Peru, EPU, rose 1.6% today.

One can use this Finviz Screener to view common commodity ETFs.

All stocks including utilities, XLU, are now likely to be headed lower.
Northeat Utilities,
NU, has been an outstanding performer.

IV … Bear Market News provides the Michael Hudson article A New Financial War which relates: “Quantitative easing subsidizes U.S. capital flight, pushing up non-dollar currency exchange rates” This is something I document in my article  Gold Soars To A New High As World Currencies Take Stocks Higher Against The US Dollar And US Treasuries   Mr. Hundson continues:  “On the deepest economic lane, the present global financial breakdown is part of the price to be paid for the Federal Reserve and U.S. Treasury refusing to accept a prime axiom of banking: Debts that cannot be paid, won’t be. They tried to “save” the banking system from debt write-downs in 2008 by keeping the debt overhead in place. The resulting repayment burden continues to shrink the U.S. economy, while the Fed’s way to help the banks “earn their way out of negative equity” has been to fuel a flood of international financial speculation. Faced with normalizing world trade or providing opportunities for predatory finance, the U.S. and Britain have thrown their weigh behind the latter. Targeted economies understandably seeking alternative arrangements.”

IV … Charles Hughes Smith in articleThe Coming Collapse of the Real Estate Market relates: “As I have documented here numerous times, the entire U.S. mortgage market has already been socialized: 99% of all mortgages are backed by the three FFFs–Fannie, Freddie and FHA–and the Federal Reserve has purchased a staggering $1.2 trillion in mortgage-backed assets in the past year or so to maintain the illusion that there is a market for mortgage-backed securities.  (Chart of Mortgage Backed Bonds, MBB, and chart of a typical mortgage-backed securities mutual fund, GSUAX.)

Now the entire legal basis for that privatized-profits, socialized losses system has dissolved. The foreclosure scandal is not just a “scandal” in which various frauds were brought to light; it is the failure of the entire system of originating mortgages that props up the entire real estate market. I recently reported on the depth of the crisis for AOL’s Daily Finance: The Foreclosure Crisis: Eroding Trust — And Ending The Recovery?

The Mainstream Financial Media has been forced to gingerly poke around the delicate topic, and surprise, it is difficult to put a positive spin on the crisis in article Document Questions Cloud Recovery: Agents Fear Housing Could Stall as Uncertainty on Foreclosures Unnerves Buyers, Especially Investors. "Title companies would be crazy to ensure title on anything remotely associated with a foreclosed property because we don’t know how this is going to resolve itself,” said Mark Hanson, an independent housing analyst in Menlo Park, Calif.

The result: Not only could sales slow on foreclosures now listed for sale, but it could also become harder to sell or refinance properties that have been foreclosed upon at some point in the past few years.
Real-estate agents are particularly worried about the situation’s impact on investors, the buyers who fix up foreclosed homes for resale. Investors accounted for 21% of all home sales in August, according to the National Association of Realtors.

Little-Known MERS Faces Big Challenges in Foreclosure Battle: “Success in challenging MERS’ role in a foreclosure could mean the owner of a mortgage holds a loan without claim to the house as collateral, Mr. Weissman said. That result could set off a chain reaction reducing the value of mortgage servicing rights, an asset many banks keep as an investment.

Are We Headed for Housing Armageddon? So to summarize:
1. The banks which depend on revenues collected from mortgage servicing are facing the possibility that millions of distressed mortgages will enter legal limbo and not be paid; additionally, millions of underwater homeowners realize they can stop paying their mortgages with no near-term consequence because the foreclosure system is frozen.
If you doubt this, please read Gonzalo Lira On The Coming Middle-Class Anarchy.
2. The mortgages which the banks are holding on their books as income-producing assets at full face value are in effect either worthless or depreciated to some significant but unknown degree. If this fact were reflected in their balance sheets, all the big banks would all be insolvent. (This comes via FASB 157 which entitles banks to mark property at manager’s best estimate rather than mark to market) .
3. Evictions based on foreclosures can be halted, delayed or even cancelled. Consider this alternative response to wrongful eviction as reported by the WSJ Evicted Family Breaks Into Their Former House (I add this entitles mortgage owners to live payment free in their mortgaged properties).  
4. Pending sales of properties that were foreclosed are now of dubious legality.
5. Anyone buying a house in foreclosure, or a house that was foreclosed, cannot get title insurance.
6. Investors who have been propping up the housing market by snapping up properties in foreclosure (REOs or “distressed properties”) face high risks and uncertainties in buying any real estate that was in or is in the foreclosure pipeline. That means markets will lose 30% to 50% of their buyers.
7. Buyers who closed on foreclosed homes now face legal challenges to their ownership and potentially even “clawback” of the property as the previous owner can claim he/she was defrauded by a flawed/defective foreclosure process.

8. Real estate attorneys can rejoice: everyone will get sued, in every court in the land. Banks will get sued, title insurance companies will get sued, realtors will get sued, foreclosure mills will get sued, MERS will get sued, and so on. The attorneys general of the states will all sue the banks and mortgage mills, claiming billions in damages.
Anyone who thinks this is all trivial technicalities is wrong.
9. The real estate market will collapse as the imbalance of buyers and sellers swings to extremes. Buyers vanish as trust in the institutions of real estate finance and property rights has collapsed, and millions of distressed/defaulted mortgages don’t get paid. Underwater sellers have a stark choice: either dump the house for cash (assuming the bank allows a short-sale and eats a massive loss) or stop paying the mortgage and see what happens.
That sets up a new positive feedback loop in a very tenuous market: millions of underwater homeowners will realize their homes are plummeting in value and “recovery” is hopeless. Millions more who were on the edge will be pushed underwater as prices fall. The incentives for the newly underwater are clear: stop paying the mortgage, since price “recovery” is hopeless and the foreclosure process is frozen.
The imbalance between few buyers and millions of properties on the market or in the shadow inventory has only one “capitalist” resolution: the destruction of price down to levels that clears the inventory.
Las Vegas offers a example of this clearing: condos are selling for 15% or 20% of their bubble-era valuations–and this is with massive Federal subsidies of the mortgage market.
10. There is a fundamental legal battle playing out between the property rights and rules of law embodied in state laws, and the Central State/Federal laws which enable MERS to transfer ownership of mortgages as securities. You can’t have both systems at the same time; either transfers of mortgages and ownership and the procedure of taking real property (foreclosures) meet state laws or these laws have been rendered moot.

Either there is due process of law or you have a kleptocracy/”banana republic” oligarchy. At present, that is the decision we face as a nation. If the banking Elites and their partners in the Central State (Fed and Treasury) are allowed to “win” and gut the property laws of the states, then the U.S.A. will be revealed as a kleptocracy/”banana republic” oligarchy.

If state laws are upheld, then the “too big to fail” banks are insolvent and they will fail. Then the question of kleptocracy arises once again: will the banks be allowed to fail as per Classic Capitalism, that is, their owners and managers will have to absorb the losses of that bankruptcy/failure, or will the Central State use its powers to collect taxes and cover the private losses of the Bank/Financial Power Elites? Privatizing profits and socializing losses has been the entire game plan since the global house of cards collapsed in 2008.

It’s decision time, citizens. Either the banks/Central State “win” and we are a kleptocracy/ “banana republic,” or they lose and the U.S. mortgage/ banking sector implodes and is either formally socialized (i.e. owned lock, stock and barrel by the Central State) or rebuilt from scratch without big banks, Federal guarantees and the Fed’s incestuous interventions. “We create the credit that enables the mortgage, you issue the mortgage, and then we buy the mortgage.”

There is no “fix” or half-measure that can patch this over now.
The non-mainstream media can speak the truth directly. For example, here is the excellent Acting Man blog: Total Chaos: The biggest question of all, is there anyone working on a solution? I know the answer to that: No. We now have socialized housing. If you disagree, just imagine the consequences if government intervention were withdrawn. Real estate markets would collapse immediately. The government is the market. There is no exit strategy. The feedback loops are in full runaway mode, and the end-state will be a collapse of one system or the other: either the incestuous Banking Cartel-Fed-Treasury system of “private profits, socialized losses” implodes, or property rights and the real estate market implode. Right now, both are imploding, and each system’s implosion reinforces the other’s collapse.

(It will be interesting to see how Banks,
KBE, perform and how real estate stocks and ETFs, perform  BLK BPO STD PSR .. FIO.

V … Stewart Patrick of the CFR writes in Spiegel Euro-Zone Crisis Presents Opportunity for Greater Unity: “With the EU mired in crisis — from demonstrations in French streets to Irish bank bailouts — strong leadership from European capitals is more important than ever. Unfortunately, the EU suffers from a leadership void. Rather than stepping up to the plate on behalf of the union, however, national leaders are focused on appeasing domestic constituencies.”
I perceive that the Eurozone became a region of global governance on May 10, 2010, as the EU Finance Ministers announced European Economic Governance and called for a monetary union with seigniorage authority to issue eurobonds.

Global governance is the political driving force of this age as Flash News Today provides The Hindu report. India To Participate In Asia-Europe Dialogue: “On Monday, October 4, the leaders will convene “the eighth Asia Europe Meeting (ASEM) Summit in Brussels and will address “priority number one” — moving towards a declaration calling for more effective global financial and economic governance.”  ConsiliumEuropa provides the PDF transcript of the Herman Van Rompuy speech More Effective Global Financial And Economic Governance given at the 8th Asia-Europe, ASEM, Summit held in Brussels.  And, Stock Market News Australia reports Chinese Premier Wen Jiabao said at the Europe Asia Summit: “We must explore ways to establish a more effective global economic governance system”.  

Many today would like to dismantle the Eurozone by one means or another. My reply to them, is that there are indeed many problems in the Eurozone, these include different rates of productivity, growth, inflation, sovereign debt interest rates, taxation and others issues such as the report by Tyler Durden that
The ECB Directly And Indirectly Monetized All Irish September Treasury Auctions; the action raised Irish ECB borrowings to 9% of liabilities, the same as Portuguese banks.

In my mind, there will never, repeat never be any dismantling of the Eurozone, nor will ever be any default of either sovereign debt or banking debt by Eurozone members. The periphery countries, particularly Greece, Ireland, Italy, Portugal, and Spain indeed have significant issues, but they will never voluntarily leave of their own accord.

Herman Van Rompuy, President of the  European Council, presents a video reporting the accomplishments of the task force on economic governance which took place in Brussels on Monday July 12, 2010; and he specifically said that at the current time, sovereign debt default is out of the question — sovereign debt default would imply separation from the Union. And EuroIntelligence has it right as they report on October 8, 2010: No bond holder participation in Ireland: “It sounded like an exciting piece of news, when Ireland’s regulator pronounced that Ireland may after all participate the senior bondholders in the rescue costs. Ireland’s finance minister Brian Lenihan yesterday not only contradicted this. He also outlines the rules for the subordinate bondholders, which suggests that even those will not really be participating. It would only apply to institutions which are not listed on a recognised stock exchange, are in 100 percent state control and could not survive in the absence of total state support. That exempts pretty much anybody.  So the Irish bank bailout is de facto finance to 100% by the tax payer.”

Ambrose Evans-Pritchard in Telegraph article Europe Prepares Nuclear Response To Save Monetary Union, writes provided an astute observation:  “The walls of fiscal and economic sovereignty are being breached. The creation of an EU rescue mechanism with powers to issue bonds with Europe’s AAA rating to help eurozone states in trouble — apparently €60bn, with a separate facility that may be able to lever up to €500bn — is to go far beyond the Lisbon Treaty.  Creating an EU Treasury in all but name, managing an EU fiscal union where liabilities become shared. A European state is being created before our eyes.”

Yes, as Mr. Evans-Pritchard communicates: national sovereignty was waived as the EU Leaders announced their agreement, just as in the United States, in March 2005, the three leaders of the North American continent announced the Security and Prosperity Partnership of North America, The SPP, at Baylor Baptist University; in so doing they abrogated Constitutional law; and waived sovereignty, and established a home, or better stated, a homeland for the continent’s people.

The future has been set; it is as Angela Merkel said, “
If we are to have a global order and global governance we need to have an understanding for each other.” according to BBC report Germany’s Merkel Calls For Tougher Finance Regulation.

The application is that the word, will and way of politicians, government administrators and banking leaders is emerging as the governing principle in economic affairs.
An Observant Mind believes a Financial Regulator, acting in concert an unannounced council of stakeholders, specifically elected officials, bank presidents, SEC-ECOFIN officials, and GSE administrators will effect policy that sustains an intertwined state corporate rule, that maintains the interest of the political and economic elite. One of their goals is to maintain the value of banking and real estate assets at the current levels as much as possible; and as such they effect policies to mitigate deflation. I present several examples below:

On, October 5, 2010, Japan took the ultimate action. In a unilateral decision, it went nuclear in the currency war that started September 15, 2010, when it intervened in the currency markets and sold Yen. In a unanimous vote, the Bank of Japan’s nine-member policy setting board set its interest rate at zero, that is, it established a Zero Interest Rate Policy, ZIRP,  in an attempt to stop the rise in its currency and to appease political dissent that has risen over Japan’s ongoing deflation.

EconomicPolicy Journal
relates that the Bank of Japan announced that it may buy J-Reits and J-ETFs as well, in an attempt to appease Japanese politicians who relate they have had enough of deflation.

Shaun Richards
relates: “In addition it stated that it would look at establishing a temporary 5-trillion-yen ($60 billion) fund to purchase various financial assets such as government securities, commercial paper and corporate bonds in an attempt to stimulate the economy by lowering longer-term interest rates or what are more commonly called asset purchases or Quantitative Easing. The central bank will offer another 30 trillion yen ($359 billion) through its loan program.”

It is quite a stunning thing when a central bank goes to zero; Japan has simply decided to print money at will. Furthermore, the central bank of Japan, has in effect become the unitary, and sole provider of capital and money in Japan crowding out all bank lending. It has  integrated banking and government into a state corporate combine; and it has effected a bloodless coup, establishing state corporatism, that is state corporate rule over the people of Japan.

I relate that in the United States, the Dodd Frank legislation established a Federal Financial Regulator, that being the Treasury Secretary, and granted him wide discretionary power of the economy. From the Robert Wenzel, EconomicPolicy Journal article Secret SEC Meeting with Goldman Sachs and JP Morgan, I conclude that in the US, through an October 6, 2010, meeting of bankers, investment bankers and SEC officials, that an elite group of stakeholders has arisen to act as a “banking, lending, credit, and investment Regulatory Council”, supporting the Financial Regulator in overseeing the US economy.

I believe that the Dodd Frank legislation, empowers the Federal Financial Regulator, to intervene in the foreclosure moratorium issue; and that at some point in the future he will provide a solution that integrates the banks with the Government in state corporate governance over housing and mortgage securitization. Perhaps, Annaly Capital Management,
NLY, may have a role to play, given that it has done so well in the Government debt field.

And I envision that in Europe, with a fall in the EUR/JPY from 114.71, seen in chart of FXE, FXY, falling from 1.15, there will be debt deflation.  The Euro, FXE, will fall below 140, and the European Shares, VGK, will fall below 51.50, and the European Financials, EUFN, will below 23.20.

Then a liquidity crisis will emerge, where there will not be enough buyers for sellers of stocks as well as bonds, causing small business failures, and banks to become sorely decapitalized, resulting in the president of the ECB arising to be an “Eurozone Credit Seignior” and provider of liquidity to Europe. The word Segnior means top dog banker who takes a cut.  Many Europeans will come to trust in him, and conduct their economic affairs through him, as he will oversee all banking, lending, and credit throughout the entire Eurozone.

VI. … In today’s News
Martin Crutsinger of The Associated Press reports Trade Deficit Widens Sharply ToMartin Crutsinger $46.3 Billion

Christopher S. Rugaber of the Associated Press reports Wholesale Prices Rise For Third Straight Month On Higher Food And Energy Costs … Chart of food commodity prices FUD
James Whitmore in PropertyWeek reports:  Boston’s tallest skyscraper is being sold to the real estate tycoon and newspaper publisher Mort Zuckerman’s company for $930 million in the largest real estat purchase in the US this year, Boston Properties has agreed to buy the John Hancock Tower and Garage from Normandy Real Estate Partners and Five Mile Capital Partners, said Robert Griffin of Cushman & Wakefield who acted for the vendors. ” The bidding was as fierce as anything I’ve ever handled during my 30 years in this business.” Boston is paying  295.5 million, and assuming for $640.5 million of debt in the deal.

EconomicPolicy Journal relates Show Me The Note: Showdown in America, a spinoff from National People’s Action, is out with a short video telling mortgage holders to demand notes at foreclosure hearings. Does anybody really believe the banks have most of these notes? For the masses, this is fast becoming a “people against the banks” issue. For private property people, who believe in the rule of law, if banks don’t have the proper paper work, they lose.

Disclosure: I am invested in gold bullion