Archive for 2010

Predatory Lending – Tim Miller – “Love, Your Broken Home”

Courtesy of 4closureFraud



A little while back I listened to an interview on the radio involving predatory lending practices. On one side, they had a family on the verge of being homeless because of these predatory practices. On the other side, they interviewed a twenty something year old lender.

I know there are a lot of borrowers out there who were greedy and got burned because of it. This family, however, was not one of those borrowers.

Essentially, this family trusted the lender and was taken advantage of. The family was persuaded to “lock in” a variable rate loan because of its “favorable” terms. Because of the “favorable” terms, of course, the lender told the family they could borrow much more money than, in reality, the family should have.

The lender prospered by exploiting families like this – actually saying in the interview how he and buddies would fly to Vegas, go to the best clubs, etc. etc.

Not surprisingly, the family’s home was foreclosed after their interest rate reset according to the terms of the loan.

The interview had a profound effect on me and inspired me to write a song about this American tragedy.

I stopped by producer/engineer Chris Bell’s place and we ran it down using his Canon 7D camera.

By: Tim Miller © 2010


AND I, I I …


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Investor Sentiment: Tough To Be Bearish

Courtesy of thetechnicaltake


It is tough to be bearish for the following reasons: 1) the overwhelming consensus opinion of investors, bloggers, and newsletter writers is bullish now and into 2011; 2) the perception amongst investors is that the Federal Reserve has back stopped the market; 3) there is a persistence to the tape as it marches higher on both good and bad news; and 4) it is the holiday season where thinly traded markets can be easily manipulated higher.  Yes, it is tough being bearish when everyone and everything you read is bullish, and the equity market can only go one way — up.  Yet, here I write that I am bearish.  Why?


{click on images for larger charts}


Investor Sentiment 12.20.10

It’s Never Too Early to Predict the Future!

Courtesy of ilene

For more reading, check out this week’s Stock World Weekly

Weekend Reading: It’s Never Too Early to Predict the Future!

By Phil at Phil’s Stock World

Barron’s already has the 2011 Outlook on the Cover.  

outlook timelin

We were discussing the generally bullish mood in Member Chat and Barfinger said “So, Phil, what is your response to the bullish preview?”   That was a great question because it made me think.  Does he expect a “rebuttal“?  I can understand that as I’ve been fairly bearish but let’s not confuse caution (I called for a cash out when the Dow hit 11,200 in early November, it peaked at 11,444 on the 5th and closed Friday at 11,491) with bearishness – it’s just that my now 45 days of running around saying “the sky is falling” while it stays in place does make me seem like a perma-bear.  

The “October Overbought Eight” was my first bearish portfolio since April 28th’s “Hedging for Disaster – 5 Plays that Make 500% if the Market Falls” (and it did, and they did).  THAT was a bearish outlook!  We are not that bearish here, otherwise it would have been the easiest thing in the World to re-up those plays for the new year.  We expect a correction, but hopefully not the kind we had between May 4th and July 2nd, where the Dow dropped 1,600 points in just over 2 months.  We are HOPING for a nice 20% pullback off the 15% gain from 9,800 to 11,270 back to the 11,000 line and holding that would make us very bullish going into next year.  

That would be 1,180 on the S&P (the declining 200 dma) and just 5% down from Friday’s close – THAT’s how bearish I am!  Where we are now is simply where the 5% Rule told us we’d be back on May 5th, where the chart pointed out that 1,240 is 20% off the upper, non-spike consolidation at 1,550 that marked the high for the S&P.  20% is the most powerful level in the 5% Rule and that’s why it’s been safer to wait and see how this line resolves than place long-term bets in either direction into the slow and volatile holidays.

Obviously, I am fairly convinced that Global “leaders” are making all sorts of policy

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JPM Fraudclosure Whistleblower Emerges

Courtesy of Tyler Durden

The one main thing missing from the recent escalation in charges against the major banks in regard to the fraudclosure scandal has been an internal whistleblower who can corroborate that all the charges against the various illicit mortgage practices. After all, it is one thing to lay allegations, and totally different for a court of law to find that these are validated. So far it is precisely the latter that has been missing as no court is willing to escalate an issue that could potentially unwind decades of mortgage securitization. Yet all that may be about to change. Daily Finance’s Abigail Field presents the case of one Linda Almonte, a former employee of JPM, who is not only suing the bank for wrongful termination, but has now also filed a whistleblower complaint with the SEC. Filed says: “The core allegations add context to her lawsuit, and they charge Chase with grotesque and illegal practices involving its credit card debt processes, including robo-signing.” Sure enough, JP Morgan is denying everything. Yet a close look at the details presented by Almonte indicates that either she is blatantly lying, or JPM may be in water just as hot as Bank of America.

Per the formerly confidential statement, Almonte’s 5 main allegations regarding JP Morgan are as follows:

1. Chase Bank sold to third party debt buyers hundreds of millions of dollars worth of credit card accounts. . .when in fact Chase Bank executives knew that many of those accounts had incorrect and overstated balances.

3. Chase Bank executives routinely destroyed information and communications from consumers rather than incorporate that information into the consumer’s credit card file, including bankruptcy notices, powers of attorney, notice of cancellation of auto-pay, proof of payments and letters from debt settlement companies.

4. Chase Bank executives mass-executed thousands of affidavits in support of Chase Banks collection efforts and those Chase Bank executives did not have personal knowledge of the facts set forth in the affidavits.

5. When senior Chase Bank executives were made aware of these systemic problems, senior Chase Bank executives — rather than remedy the problems — immediately fired the whistleblower and attempted to cover up these problems.

Almonte’s lawyer, George Pressly operates the

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Yeonpyeong Island Residents Ordered To Move Into Air Raid Bunkers As North Korea Places Rocket Launchers Along Western Coast

Courtesy of Tyler Durden

The din out of North Korea was a little too quiet recently. Not so much anymore. Yonhap has just reported that the residents of the infamous Yeonpyeong island, which was recently shelled by North Korea in response to a South Korea drill, and other bordering islands. have been ordered to move into air raid bunkers. This is a very rapid escalation following the earlier announcement by The Chosunilbo that North Korea has deployed rocket launchers along its west coast, in response to a live fire artillery drill which South Korea announced earlier would proceed as planned. “The North also reportedly made coastal artillery ready to fire and put some fighter jets on the west coast on standby.”

From Chosunilbo:

North Korea has deployed multiple rocket launchers along the shore north of Yeonpyeong, Baeknyeong and Gangwha islands in response to a planned South Korean artillery drill on Yeonpyeong, government sources here say. The North earlier threatened an “unpredicted self-defense counterattack” to the drills.

A South Korean government source said, “After making the threat in a message sent Friday, North Korea raised the alert level at artillery divisions on the west coast and deployed the multiple rocket launchers.” The source added the South Korean military is monitoring the situation.

And just to make sure that the world is fully aware which axis is now calling the geopolitical shots, Russia’s UN envoy Churkin told South Korea it would be “better” it the country did not hold its military exercises (which had previously received America’s blessing) at this time. 


Elsewhere, the USAF 36th Wing,which includes B-52a and B-2s, is being put on speical alert in case things get really out of hand:

All active personnel serving with the Air Force Global Strike Command have been issued a special alert on Dec 18. Air Force Global Strike Command is responsible for deploying Long Range Strategic Bombers including B-52 and B-2 bombers. There are believed to be 30 B-52 and 11 B-2 bombers stationed at Anderson Air Force base on the Island of Guam. The USAF 36th Wing would be used as the main bomber force in advent of a war on the Korean Peninsula. The Amateur radio operator affiliation known as Sky Watchers has

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Riots Erupt In Bangladesh After Stock Market Plunges 6.7%

Courtesy of Tyler Durden

For what may be the best look at the future of the world’s most recent Banana republic entrant (the U.S.S. of A. for the confused) has to look forward to, we need to merely shift our attention at another one, which has had the privilege of experimenting with its Banana status for far longer: Bangladesh. After the stock market plunged on Sunday by 552 points or 6.72%, hundreds of angry investors took to the streets, “threw bricks at police, marched in the streets shouting slogans, and staged a sit-down protest.” These very same “investors” which have and always will be better known as momo investors, which chase returns only to end up with the live grenades, “chanted slogans against the government and the regulators, and marched through the busy roads in the Motijheel Commercial area, halting traffic. They also staged a sit-in at the SEC building.” The reason for the recent mass hysteria in chasing stocks: pretty much the same as what the Fed is trying to do right here in the US: “The rising value of the stocks in recent years has attracted hundreds of thousands of small-scale or retail investors in Bangladesh, says the BBC’s Anbarasan Ethirajan in Dhaka. It became a popular investment for ordinary people, often providing higher returns than bank deposits and savings.” Well, with the USA today posting an article with the following title on its cover page: “Experts agree: Get over your fear and get back into stocks “, and more incredulously, when one of these so-called experts is none other than David Bianco, the same utterly irresponsible creature who in October 2008 cut his 12 month S&P forecast from 1650 to 1500, well there is nothing much left to say: Bernanke has succeeded in converting America into a third-world subcontinent country.

From BBC:

The index ended the day down by 552 points or 6.72%. It has been on a rollercoaster ride in recent weeks, hitting a record high on 5 December, having climbed 80% since the start of the year.

But on 8 December it nosedived, prompting protests in Dhaka and towns elsewhere.

On Sunday, at least 500 investors hurled bricks at law enforcement officers near the Dhaka Stock Exchange and the Securities and Exchange Commission (SEC) offices, said local police chief Tofazzal Hossain

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Courtesy of The Pragmatic Capitalist 

By Annaly Capital Management

The news flow of the last several weeks has centered around several very big issues: American structural budget deficits and the new tax agreement being hammered out in Washington DC, the bailout of Ireland and the precedent it may set for other European countries, fiat money vs. hard money, sovereign ratings downgrades, the growth and inflation policy objectives in China, bank capital adequacy from stress tests to Basel III and central bank responses to economic weakness. Flow is the operative word here, as with issues like these there really is never a culminating event. The statement put out today by the European Union on a new currency stability mechanism, is no different. The key section: “The Member States whose currency is the euro may establish a stability mechanism to be activated if indispensable to safeguard the stability of the euro as a whole. The granting of any required financial assistance under the mechanism will be made subject to strict conditionality.” This statement might seem like the culmination of a debate, but it can also be viewed as a part of the historical imperative of European Union, its manifest destiny if you will.

We have long believed that unless and until the “member states whose currency is the euro” started moving towards a stronger socio-economic connection it would become more and more difficult to hold the euro together. The closest analogue we can think of is “the member states whose currency is the dollar.” Does not the US have significant economic disparity between weak states and strong states? Does not the US have significant cultural differences between north and south, east and west? And do not the member states of the American union have a shared interest in safeguarding the stability of the dollar despite our economic and cultural differences?

Whether or not we are witnessing the end of the debate in Europe or simply another milestone on the way to The United States of Europe is a question for a dissertation, not a blog. In the meantime, these questions lead us to consider the current global monetary standing of “the member states whose currency is the dollar.” Below is the shrinking market share of the US Dollar as the world’s reserve currency since 1999…and the growth of the euro.

Below is the United States’ shrinking market share of global…
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The Next Stop In Obama’s Political Suicide Tour: Announcing Social Security Cuts During State Of The Union Address

Courtesy of Tyler Durden

Obama’s latest quid-pro-quo with the republican party over a doubling down on fiscal stimulus in the form of mutual back scratching, funding by yet another trillion in debt, may have well be the start of his toxic spiral to the the bottom of political insignificance. According to Politico, "The tax deal negotiated by President Barack Obama and Senate Republican leader Mitch McConnell of Kentucky is just the first part of a multistage drama that is likely to further divide and weaken Democrats." Next up on the path of what many see as the terminal alienation of the president from his liberal constituency, will occur during the next State of the Union Address, when the teleprompter in chief is expected to announce cuts in Social Security, according to Politico which quotes "well-placed sources." Why will the president pretend to espouse even an ounce of fiscal prudence? Because, around that time the discussion over the US debt ceiling will be in full heat: we expect total US debt to be about $14.1 trillion by the end of January: just a $200 billion buffer from the debt ceiling breach. Therefore, as Robert Kuttner of politico speculates: "The idea is to pre-empt an even more draconian set of budget cuts likely to be proposed by the incoming House Budget Committee chairman, Rep. Paul Ryan (R-Wis.), as a condition of extending the debt ceiling. This is expected to hit in April." And as Kuttner once again phrases it best: "How to put this politely? For a Democratic president, this approach is bad economics and worse politics."

More from Politico:

For starters, cutting Social Security as part of a deficit reduction deal is needless — since Social Security is in surplus for the next 27 years. The move also gives away the single most potent distinction between Democrats and Republicans — Democrats defend your Social Security, and Republicans keep trying to undermine it.

If you think the Democratic base feels betrayed by Obama’s tax-cut deal, just imagine the mayhem when Obama proposes to cut the Democrats’ signature program.

Sen. Al Franken (D-Minn.) compared Obama’s tax deal to punting on first down. A pre-emptive cut in Social Security is forfeiting the game before kickoff.

Obama is already in trouble with older voters. Republicans have succeeded in convincing seniors that the health care reform bill diverted money from

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A Look At The Upcoming Calendar As The Sleepiest Week Of The Year Arrives

Courtesy of Tyler Durden

The upcoming week will be largely one where absolutely nothing happens. Anemic volumes will continue to be anemic, outflows will continue, and nobody will care about news flow or technicals. That said, here is Goldman’s analysis of the few items that actually may matter globally in the upcoming 7 days.

What Matters in FX Next Week: Getting Ready for the Holidays

On the policy front, the US Senate voted for the bipartisan fiscal package late in the week and the European summit established a stabilization mechanism (ESM) for crises past 2013 to replace the temporary EFSF. An unexpected and positive development was the agreement for the ECB to raise its capital in order to reign in potential challenges from volatility in its asset (or collateral) portfolio. Finally, on the data front we had a positive surprises from the Philly Fed survey and the IFO posted new record highs with future expectations trending strongly to the upside and confidence in the German retail sector hovering at levels not seen since the early nineties.

In terms of our views, as we have forewarned, we have revised our US growth forecasts on the back of the US fiscal package. We now expect real GDP to rise by 3.4% in 2011 and 3.8% in 2012 (up from 2.7% and 3.6% respectively). It is hard to gauge where consensus exactly lies in terms of actual numbers as the latest surveys are slightly outdated by now. But we were above consensus in our initial forecasts in early December and it is likely that we remain so. In FX space we have already argued, stronger US growth is reducing a bit of the USD downside potential and we have revised our EUR/$ forecasts in early December to 1.50 in 12 mths time (from 1.55 initially). However, the expected widening balance of payments deficit continues to justify a bearish Dollar path and after the latest forecast round perhaps even so against economies with large exposure to the US like Canada or Mexico.

The week ahead will be a quiet one as the market gears down for the holidays. The most important release systemically will be the Durable Goods Orders on Thursday; we expect a small decline of 1%mom. We will also get the third estimate of US GDP on Wednesday. Also interesting to watch will be the MPC meetings in CEE3…
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Sean Corrigan On Six Sigma Events In The Bond Curve, “Inexorably Rising Risk”, And Other Observations

Courtesy of Tyler Durden

Diapason Securities’ Sean Corrigan is rapidly emerging as one of our favorite macro commentators. With his dose of weekly skepticism, he has quickly assumed the position vacated by Goldman Sachs’ Jan Hatzius when it comes to the 3Ms: market, monetary and macroeconomic commentary (courtesy of the now well-known and very infamous flipping by the German strategist on his outlook on the economy). In his latest outlook piece, Corrigan dissects recent moves in the bond market, noticing a 6 sigma, three-decade statistical aberration when it comes to the 2s5s30s butterfly, and continuing through the implications of increasing bond vol on other risk assets (a topic which we believe will receive much more focus in the coming weeks and months), on fund flows (his views on the implications of the December Z.1 statement are worth the price of admission alone), on the cooling off of the European “economic miracle”, and lastly, on what China’s refusal to attempt a soft landing means for global risk. His conclusion is as always absolutely spot on: “in short, that risk assets can continue to rise, pro tem, it also means that RISK itself will be climbing inexorably up the scale and on into the danger zone.”

From Sean Corrigan’s December 17 edition of Money, Macro and Markets

As the increase in the total of US Federal debt outstanding since the LEH-AIG collapse reached the $4 trillion mark, another week began and another sell-off took place in the bond market, with 2004 Euro$ now a cool 140bps off their early November highs in one of those classic, up by the stairs, down by the escalator moves to unwind the previous four months’, Fed—inspired rally.

Only a little less dramatic has been the thumping taken by the belly of the curve where — for example — the 2×5-30 butterfly has jumped 120+bps in just five weeks, a sizzling six-sigma move in a three-decade statistical record.

When we note that this was preceded by a 3½ sigma, 28-year outperformance of the middle versus the wings, taking it then to a series record low — and that half the rejection move occurred just during the past week – we can perhaps grasp some measure of the dislocation being suffered (as well as give vent to our usual despair at the idea that modern financial markets somehow exist to assist in the rational allocation…
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#1 Performing Global Macro Hedge Fund Sees More Shorts Opportunities Ahead As China Bursts

By Jacob Wolinsky. Originally published at ValueWalk.

Crescat Global Macro Fund update to investors on 1/19/2019

Crescat Global Macro Fund and Crescat Long/Short fund delivered strong returns for both December and full year 2018 in a difficult market. Based on ...

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Zero Hedge

Johns Hopkins, Bristol-Myers Face $1 Billion Suit For Infecting Guatemalan Hookers With Syphilis 

Courtesy of ZeroHedge. View original post here.

A federal judge in Maryland said Johns Hopkins University, pharmaceutical company Bristol-Myers Squibb and the Rockefeller Foundation must face a $1 billion lawsuit over their roles in a top-secret program in the 1940s ran by the US government that injected hundreds of Guatemalans with syphilis, reported Reuters.

Several doctors from Hopkins an...

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Phil's Favorites

Divisive economics


Guest author David Brin — scientist, technology consultant, best-selling author and futurist — explores the records of Democrats and Republicans on the US economy in the following post. For David's latest posts, visit the CONTRARY BRIN blog. For his books and short stories, visit his web...

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Kimble Charting Solutions

Stock declines did not break 9-year support, says Joe Friday

Courtesy of Chris Kimble.

We often hear “Stocks take an escalator up and an elevator down!” No doubt stocks did experience a swift decline from the September highs to the Christmas eve lows. Looks like the “elevator” part of the phrase came true as 2018 was coming to an end.

The first part of the “stocks take an escalator up” seems to still be in play as well despite the swift decline of late.

Joe Friday Just The Facts Ma’am- All of these indices hit long-term rising support on Christmas Eve at each (1), where support held and rallies have followed.

If you find long-term perspectives helpf...

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Digital Currencies

Transparency and privacy: Empowering people through blockchain


Transparency and privacy: Empowering people through blockchain

Blockchain technologies can empower people by allowing them more control over their user data. Shutterstock

Courtesy of Ajay Kumar Shrestha, University of Saskatchewan

Blockchain has already proven its huge influence on the financial world with its first application in the form of cryptocurrencies such as Bitcoin. It might not be long before its impact is felt everywhere.

Blockchain is a secure chain of digital records that exist on multiple computers simultaneously so no record can be erased or falsified. The...

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Insider Scoop Explores Strategic Alternatives, Analyst Sees Possible Sale Price Around $30 Per Share

Courtesy of Benzinga.

Related 44 Biggest Movers From Yesterday 38 Stocks Moving In Wednesday's Mid-Day Session ... more from Insider

Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...

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Members' Corner

Why Trump Can't Learn


Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...

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Opening Pandora's Box: Gene editing and its consequences

Reminder: We are available to chat with Members, comments are found below each post.


Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.


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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...

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Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.


This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...

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Free eBook - "My Top Strategies for 2017"



Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:


·       How 2017 Will Affect Oil, the US Dollar and the European Union


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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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About Ilene:

Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

Market Shadows >>