The Dark Underside of Janet's Calendar

And the show went on....as Yellen came under fire by House Republicans.....Now on Tuesday - Senate members questioned her on interest rates, the US economy, global concerns and the actions of global central banks and the impact it might have on US policy.....all stuff that is of concern and should be of concern to investors......

Yesterday though, - House Republicans thought it necessary to delve into the dark underbelly of her calendar, her speeches, her dinner with 'liberal advocacy groups' , the President and even Treasury Secretary Jack Lew - as they tried to build a case against her saying that she is too closely 'aligned' with the Democrats....Rep. Garrett (R, NJ) using a WSJ online tool demonstrated how anyone with access to the journal could sort Janet's calendar by date, name or event type, to 'paint a picture of a Fed guided by partisan politics'.....it made for a good laugh for anyone watching - as our esteemed elected officials tripped over each other trying to get the last word.......In the end - it's Washington as usual......

Mkts had zero reaction to the comedy taking place on Capitol Hill - in fact it seems pretty clear now that investors will continue to digest the likelihood that the Fed, and a half dozen other central banks, are set to err on the side of easing for some time. This is the common link - the tie that binds us together and what has driven global mkts to multi-year if not record highs.

Now yesterday I said I thought the shorter term path of least resistance was lower as the mkt feels like it is a bit tired and needed to re-group....by lower I do not mean a crash at all....I just mean backing and filling....as the mkt pauses.....Look - our mkt has performed incredibly well and now the S&P is trading near 20 X forward earnings.......bordering on a bit 'overbought' or expensive - so a pause or pullback now should not surprise you. In the longer term though - the path of least resistance is UP given the 'safety net' courtesy of our global central banks -

**** The role that the Fed has played in mobilizing investors into the mkts cannot be understated at all.........Both the S&P and the DOW have tripled under the direction of the unprecedented Quantitative Easing Programs and ultra-low interest rates initiated by the FED over the past 7 yrs......and just in case you lost sight of what happened in February - let me remind you.....with fixed income having little appeal and the prospect of rising interest rates somewhere in the future - the S&P has surged by 6% during the month - a respectable move and the largest one month gain since October 2011.*****

On the international front - word has it that Merkel's conservative party is beginning to doubt the latest bailout package for Greece....Finance minister Schauble to the CDU (Christian Democratic Union Party) that ' the extension could be abandoned if Athens does not stick to its pledges' saying that

"The recent remarks by the Greek Finance Minister had strained European solidarity and that a bailout extension for Athens should be ditched if the country failed to stick to its promises..."

Those comments include a resurrection of talks of a 'haircut for Greece as he (Varoufakis) cast some doubt over their ability to repay the debts......

The final vote is tomorrow - Friday - in the Bundestag ( the constitutional legislative body in Germany) ...and so we wait......

On a side note - did you read the story in today's WSJ?

"Germany Gets Money for Less Than Zero"

Yes - Germany sold 5 yr govt bonds for a NEGATIVE YIELD for the first time on record.....meaning that investors are PAYING GERMANY for pleasure of holding German debt...So with little prospects of the ECB tightening rates at all for the foreseeable future the bet is that bond prices will continue to rise giving those same investors the opportunity to sell them at even higher prices which will only force those yields even lower - The issue is that you need to always find someone willing to buy them at higher prices........Oh right - the ECB is about to launch their massive bond buying program...... feels a bit like a house of cards - no?

US futures are +3 pts in early trade. With the show over in DC the focus should return to today's economic data: CPI (Consumer Price Index) exp of -0.6%, ex food and energy of +0.1%. Durable Goods of 1.6%, ex transportation of +0.5%. Init jobless claims of 290K (up over last week) and the Kansas City Fed Survey of 3.

Look for the mkt to test the intraday upper limits of 2119 set yesterday. Without any economic surprises - don't be surprised if the mkts looks elsewhere for some a catalyst to drive sentiment. The usual suspects remain...Greece, Ukraine, Iran/Israel and the escalation of tensions between Obama and Netanyahu over the proposed deal to limit the Iranian Nuclear program.....The WH saying that the 'current strain in US/Israeli ties is unlike any other in the past .

Pork Shank Osso Bucco

Pork Shank “Osso Bucco” What a great dish - Thick, meaty, delicious....if done right - it falls right off the bone and melts in your mouth........Ossobuco: is typically braised veal shanks - a specialty in Milan it is made with carrots, celery, onions, garlic, S&P, lemon zest, red wine, beef broth and tomato paste. Through the years the recipe has been transformed as the original version did not include tomatoes....the initial preparation was seasoned with cinnamon, bay leaf and Gremolata proper. I will tell you that this is one of my favorite dishes. In today’s version I have substituted the veal shank for a pork shank…try it…it is wonderful.

First rinse the shanks and pat dry....dredge in seasoned flour – (here you can use GF – gluten free - flour) and then brown in a frying pan with heated olive oil.....making sure that you keep the heat on high to sear the outside while trapping all of the juices inside....After you have browned the meat - place in a roasting pan - making sure not to crowd them too much.....At this point - chop (not dice) chop, the carrots, celery and onions....crush 4 / 5 garlic cloves and spread the garlic and veggies over the meat. Add lemon zest on top - not to much - but enough so that you know it’s there.

Back to the frying pan - deglaze with red wine, add beef broth and a can of tomato paste (not puree) paste. Stir - bringing to a boil - then reduce heat and let thicken a bit - all of 4 mins or so.........if need be - add a bit more beef broth - then add this mixture to the roasting pan - making sure that you bathe the shanks in wine/beef broth. Cover tightly and place in a 325 degree oven for at least 4 hrs.....when ready....take a look, smell the wonderful aroma, notice how it fills the kitchen and permeates the house.....

When done - remove 1/2 of the veggies and puree. Place some of the pureed veggies in the center on a warmed plate and then place a pork shank on top of that. Next - take some of the remaining veggies and circle the shank. The final step - circle that with the butternut risotto that you whipped up while cooking this for the final presentation. Have your guests take a seat and enjoy a robust glass of the red wine of your choice.


Buon Appetito.