"Knocking on Heaven's Door"

"Mama, take this badge from me, I can't use it anymore, It's getting dark, to dark to see.......I'm feelin' like I'm knocking on heaven's door......." - Bob Dylan

The big announcement on Thursday saw the ECB ( European Central Bank) slice interest rates right to the bone while announcing plans to buy private asset-backed securities and covered bonds. Markets were initially enthused and responded in kind with indexes across the Continent rallying by 1+% - while here at home - The S&P surged to another new intraday high but failed to hold it.

Now while Draghi did not call his plan a QE program - it is essentially a 'QE Lite' program - and if he ever needed a reason or two to justify it - then continued high double digit unemployment, low inflation, possible deflation, sluggish growth and waning confidence might be a good place to start. So is this latest program just him 'Knocking on Heaven's Door'?

While the announcement is significant, investors initial excitement is now more muted and many will wait and see before they pass judgment - is this only the beginning? Could there be more? Remember - the mkts had rallied going into this meeting - so is it a 'buy the rumor/sell the news' event? This morning mkts around the globe are all in negative territory - as investors/traders digested the news.

Yes - This move is significant in that - the ECB avoided implementing such a program years ago - when both the US & UK did. 6 yrs later the US & UK are seeing better job growth and more significant changes in outlook - in fact both the US & UK are gearing up for a rise in rates as we wind down our programs while Europe has continued to struggle - never really gaining the strength to achieve 'escape velocity'.

Yesterday's action was a bit disappointing in that the early rally looked like stocks would finally break out of their sideways channel – and while they did manage to make new highs - as soon as the rally looked strong it suddenly reversed and the broader mkt failed to hold on and instead, turned south and breaching the 2000 level to close at 1997 - the lower range of the two week sideways channel. What was it now? Nothing so specific - just feels a bit tired, seemed a bit lethargic really, and we are getting the August Non Farm Payrolls report today - so just another reason for caution.

Yesterday's better than expected macro data did help to generate some interest. The Institute for Supply Management showing an unexpected acceleration in the pace of service sector growth in the month of August - climbing to 59.6 from the July read of 58.7. Now remember - anything above 50 is expansionary and since our economy is 80% service related - this was a good report.

This morning - global mkts are registering lower......In Europe - traders are booking profits and taking money OFF the table after the surge to recent highs....Long term managers remaining patient and not chasing stocks.....in the US futures are down 6 pts trending at 1991 as early indications also suggest that we could see some profit taking today after this week's attempts to move higher - all failed in the latter part of each day.

Investors will be focusing on the 8:30 am release of the August Jobs Report - expectations are for +230k jobs - but what about wages? Do not forget to look at y/y changes in wages - as this is just as important (if not more so) as the 'headline number'. Unless we get a significantly different jobs number or an unusually strong wage growth number - I suspect that the path of least resistance is lower as the week draws to a close. I would look for some support right here at 1990 ish - if we pierce that - then more significant support is at the 50 DMA of 1968/1970. On the upside - I suspect 2000 now represents a bit of resistance - at least for today.

Today we will hear from Fed Presidents - Charles Plosser (Philadelphia) at 10:15 and Eric Rosengren (Boston) at 3:45 pm. Neither one is expected to say anything that is mkt moving or policy specific. So - as we say - "Take a nothing done!"

Around the world - Japan flat, Hong Kong - -0.23%, China +0.85% and ASX -0.58%.

In Europe - FTSE -0.62%, CAC 40 - 0.26% , DAX -0.10%, EUROSTOXX -0.25%, SPAIN -0.13% and ITALY -0.12%.
Enjoy the weekend.

Lobster/Corn Chowder

Now before we say goodbye to summer - try this chowder - as the nights are now suggesting that cooler days are ahead.

I received this Corn and Lobster Chowder recipe from a dear friend - Margaret a couple of years ago - it is hearty, delicious and not so hard to make. As it is not my recipe per se - I am including the exact measurements as she gave them to me - as by now you know - I cook by feel -never exact - but that is what makes it creative and interesting....Enjoy.

You need: 2 10-ounce frozen uncooked lobster tails, thawed, or 1 pound freshly cooked lobster meat, cut into bite-size pieces
8 cups frozen yellow corn kernels (about 2 1/4 pounds), thawed
3 cups low-salt chicken broth
8 bacon slices, chopped
2 cups chopped onions
3/4 cup peeled finely diced carrots
2/3 cup finely diced celery
1/4 teaspoon cayenne pepper
3 cups bottled clam juice
1 1/2 cups whipping cream
6 tablespoons sour cream
2 tablespoons (1/4 stick) butter
3 tablespoons chopped fresh chives
If using thawed frozen lobster tails, cook in pot of boiling water until almost cooked through, about 6 minutes. Drain. Cool. Using kitchen shears, cut lobster shells open. Remove lobster meat; cut into bite-size pieces. Discard shells.
Puree 4 cups corn with 1 1/4 cups broth in processor until almost smooth.
Sauté bacon in large pot over medium heat until crisp, about 5 minutes. Transfer bacon to paper towels. Pour off and discard all but 3 tablespoons drippings from pot. Add onions to pot; sauté until light golden, about 5 minutes.

Add remaining 4 cups corn; sauté 3 minutes. Add carrots, celery, and cayenne; sauté until vegetables soften slightly, about 5 minutes.

Add clam juice and 1 3/4 cups broth; simmer 10 minutes. Stir in corn puree and whipping cream; simmer 5 minutes. Season with salt and pepper.

Remove soup from heat; stir in sour cream.

Melt butter in medium nonstick skillet over medium heat. Add lobster meat and sauté just until heated through, about 2 minutes. Ladle soup into bowls. Garnish each serving with lobster pieces, bacon, and chives and serve.


Buon Appetito.