Many homeowners are now running into trouble with their mortgages because they didn't understand what they were getting themselves into when they signed up for artificially low payments with teaser rates. Then the payments exploded upward and now they're facing foreclosure. Similarly, free agent catcher Jason Varitek has cost himself millions of dollars because he didn't understand Major League Baseball's arbitration process.

Varitek served as the Red Sox catcher from 1998 through 2008 but at age 36, his numbers have been in decline for the last two years. At the end of the season, the Red Sox offered him arbitration -- a process by which Varitek and the team would exchange proposed salaries and an independent arbitrator would pick which number was most appropriate. Because of MLB rules, the least Varitek could have made was $10 million for the season.

Varitek rejected the offer of arbitration and became a free agent and because he is a Type-A free agent, any team that signs him will have to surrender a first round draft pick to the Red Sox.

The Boston Globe reports that after handing out 24,000 rebate checks following the Boston Red Sox win in the 2007 World Series, Berkshire Hathaway (NYSE: BRK.A)'s Jordan's Furniture unit is taking a bet on a 2008 repeat.

In a furniture industry suffering from flat sales due to a weak housing market and rising gasoline prices, this promotion is seen as a critical tactic for keeping sales from tumbling. In 2007, Jordan's deal was that anyone who bought furniture at its stores -- which feature Imax theaters -- between March 7 and April 16 would get a rebate check if the Red Sox won the 2007 World Series.

This year, Jordan's is repeating the deal with a twist that lowers the odds of a payout. The "Monster Sweep 2008" will offer customers who make a purchase between today and April 27 rebates on their purchases of sofas, sectionals, dining room tables, beds, mattresses and rugs only if the Red Sox win the 2008 World Series in four consecutive games.

Warren Buffett bought a prominent Massachusetts furniture company -- Jordan's Furniture -- in 1999 for between $200 million and $300 million. At the beginning of the season, Jordan's announced it would reimburse the furniture purchases of anyone who bought sofas, dining tables, beds, and mattresses there between March 7 and April 16 if the Red Sox won the World Series this year.

According to the Boston Globe, Jordan's took almost 30,000 orders during the contest. One customer stands to get back $40,000. Jordan's covered this bet through an insurance policy. It would not disclose which company issued the policy, but it would not shock me if it was issued by Berkshire Hathaway (NYSE: BRK.A).

As a lifelong Boston Red Sox fan, I am absolutely thrilled that they are in the World Series for the second time in a few years. And last night's blowout victory against Colorado was a great way to start. Unfortunately, my years of being disappointed by the Red Sox are making me wary about whether they can keep pulling off wins.

John Henry acquired the Boston Red Sox in 2002, and led the team to its first first World Series victory since 1918 in 2004. This year, the team is off to a 26-11 start, good enough to give it the best record in baseball. However the hedge fund empire that gave Henry the money to buy the team has not fared so well. In fact it's performed more like the Kansas City Royals, who have the worst record in baseball. Since December of 2004 (2 months after the Red Sox won the Series), his fund has lost a mind-boggling 36% of its value, and assets under management have been cut in half to about $1.4 billion as investors flee in search of better returns.

The recent free-fall has given the investment legend a pretty poor long-term track record, and got me thinking: Is Henry just no longer that interested in trading commodities and such? He's already earned hundreds of millions, and one could hardly blame him for pursuing pennants instead of pork bellies.

This reminds me of a study I read about a few months ago, which suggests that companies whose CEO's have recently purchased large houses are likely to underperform the market. As I wrote then, "Building an expensive home may be a sign that a once-driven executive is getting bored with work. And besides, who has time to manage things like cash flow and strategic vision when there's wallpaper to pick out, home theater packages to choose from, and a wine cellar to design? Being a CEO takes a lot of time and energy, and so does building a palace. Something's gotta give."

My suggestion to investors: Avoid investments where the CEO or fund manager has interests other than making lots of money with your investment. This might sound cold-hearted, but it takes a super-human to build a great art collection and manage a company. As a loyal Red Sox fan, I'm thrilled that his fund has tanked as the Red Sox have soared, and I'm just glad I didn't have money in Mr. Henry's fund.

You can't ever say that Boston Red Sox fans aren't enthusiastic. A gas grill, reportedly listed by Manny Ramirez, has been removed from online auction site eBay Inc. (NASDAQ:EBAY) after bids spiked to nearly $100 million. Originally purchased for about $4,000 and used once, according to the Red Sox slugger's testimony, the minimum bid of $3,000 was registered shortly after 1:00 p.m. Tuesday. By midnight, the offers were out of control.

While the site offered no explanation for the listing's removal, other parts of the eBay web site warn that items may be taken down if thought to violate eBay policies. The listing had featured seven pictures of the Jenn-Air grill, two with Ramirez in the shot.

When asked by the Associated Press why he was helping sell the grill (later discovered to belong to a neighbor), the ballplayer with the $160 million contract joked "I need the money." He also promised an autographed baseball for the winning bidder.

Beth Gaston Moon is an analyst at Schaeffer's Investment Research.