Highlighting the shift in the markets focus from central bank activism to economic reality is the selloff in European stocks after Germany reported its Sept IFO business confidence figure. At 101.4, its down from 102.3 in Aug, below expectations of 102.5 and the weakest since Feb ’10 with both current conditions and expectations moving lower. With just a few weeks before the ESM is up and running, the EU confirmed a Der Spiegel article that officials are discussing leveraging its size to above the 500b euros. It would not be via a bank license from the ECB but with the help of private investors. Either way, resistance from Germany and Finland will be vocal to any further obligations on their part. The sharp rally in MBS after the Fed news on Sept 13th finally filtered into the avg 30 yr mortgage rate according to Bankrate.com which said it fell on Friday to 3.48% from 3.51%, to a record low.