It's Impossible to Tell The Sun to Leave the Sky...

Fall 1970 - Perry Como - after having fallen off the record charts re-ignites his career with a song that has now become an all time classic - The album (named after this #1 hit) was Como's 19th RCA Victor 12" Long Play and it was the 17th album to be recorded in FULL LIVING STEROPHONIC SOUND - (Think of that!) And for the millenniums out there - Stereophonic sound - 'is a method of sound reproduction that creates the illusion of directionality and audible perspective'!

And that Ladies and Gentlemen is what we got yesterday......Mario Draghi in Full Stereophonic sound - announces to the world that "It's Impossible - to tell the sun to leave the sky or to tell a baby not to cry..... "

As expected - Draghi finally broke the champagne bottle on the hull of the European union cutting the red ribbon on the ECB’s QE program causing the Euro to hit an 11 ½ year low. Draghi told us that The ECB is set to buy bonds to the tune of €60 billion a month through till September 2016, or until inflation gets close to its 2% target. The news caused European investors to become even more enthusiastic taking European mkts to new multi-year highs, and with the official launch of this program - strap in because it's about to get even more interesting......

And like Perry said - "And tomorrow Shouldya ask me for the world, Somehow I'd get it, I would sell my very soul And not regret it....."

Is that what we have done? Have we sold our very souls.....? (A question for another day...)

Here in the states- stocks closed slightly higher on lighter volumes and somewhat choppy trading yesterday, breaking the weaker trend of the last couple of days as the details of the ECB QE program hit the tape and traders waited with nervous anticipation for the 'stress test' results and today's nonfarm payrolls report.

The ECB announcement caused the dollar to surge to a 12-year high while the euro slipped to an 11-year low. So is the rapidly rising dollar good news? Mmmmmmmm....well maybe yes and maybe no......It is not good news if you look at it relative to what is happening to other global currencies, which have been getting decimated. Remember that a soaring dollar drives up the cost of U.S. goods abroad, while at the same time - it can undercut crude oil prices and other commodities that are priced in $'s.

Unless something changes look for oil and food commodities to come under renewed pressure as the $ strengthens.....This is not a bad thing for consumers - more cheap oil and lower food prices!

But is there new economic trouble on the horizon? Yesterday's Initial Jobless claims report was worse than expected at 320,000, (expectations were for 295,000). This is a 10-month high and the worst start to a year since 2009. Recent announcements of new layoffs and the jump in Challenger Job Cuts on Wed are now starting to build. Is this because the soaring dollar is killing demand for US goods?

Over the last couple of quarters, we have seen both 'durable' & 'nondurable goods orders' decline – not surprising with the soaring dollar. In addition we learned that U.S. manufacturing orders fell 0.2% in January - extending this 6 month losing streak for factory orders.....which inversely correlates with the 17% - 6 month surge in the dollar and as demand for US goods deteriorates, companies are left with little choice other than to 'manage costs'........Get it?

What should be concerning to the FED and investors alike is the magnitude of the surge in the dollar vs. the corresponding plunge in U.S. manufacturing orders. Why? Well because the last 2 times that this happened - the US economy was already in a recession. So you say - "but we are not in a recession"........and I say....."Are you sure?" Were it not for the new fancy accounting - would GDP numbers be where they are? Is someone manipulating the data? Is someone manipulating the mkts? Either way it doesn’t change the fact that the dollar is soaring and factory orders are plunging.... I'm just sayin.

Now onto the stress tests.....after the bell last we learned that all 31 banks are strong enough to withstand a severe recession - a hypothetical really......where corp debt mkts cease to function, unemployment hits 10%, housing and stock prices plummet and European bond yields soar.....HYPOTHETICAL? REALLY? Tell that to the many baby boomers that got clobbered.......

Interesting though that the only one near the edge was GS......now yes they passed but by the skin of their teeth....that stock indicated lower this morning. The others are all enjoying the sunlight and looking up....BAC quoted and trading up 2% in pre-mkt trading.

This morning we get the all important NFP report.....estimates range from 211k - 250k jobs created.....consensus is 230k. Now - the chatter has been one of weakness - weakness due to the weather...so any disappointment in this number will likely be disregarded and rationalized away as 'temporary or weather related' but will only further support inaction on the part of the FED - as Janet will now look for any reason to remain loose - especially when 22 other central banks are in a race to ZERO!

In today's eco data look for unemployment to supposedly fall to 5.6%.....now that will be really interesting considering that there have been more layoffs as detailed in yesterday's data..... The wage component in today’s jobs report is key. If m/m wage increases are above 0.2% and y/y gains are above 2.2% - then look for the hawks to circle putting pressure on stocks.

Retail names will be in focus today as GAP and Banana Republic reported disappointing sales last night.....JCrew CEO appearing on BB discussing the difficulty in retail sales over the past 6 months.....and this latest data clearly confirms that.

This morning US futures are flat.....as we wait. I think the data today will be a non-event and expect the mkt to test the upper limits of 2115 ish....on the downside look for the recent lows of 2085 ish to hold.

European mkts are just slightly higher as European bonds soar sending yields to record lows......Italian and Spanish bonds the big winners (or losers) as per your perspective! FTSE -0.28%, CAC 40 + 0.09%, DAX -0.12%, EUROSTOXX +0.04% SPAIN +0.46% AND ITALY +0.28%

Gemelli w/Tomatoes, Shrimp in a Creamy Pesto

This is a really great dish…..easy to make .

For this you will need: a box of Gemelli (or some other type of short pasta – cavatelli, or penne rigati, or Farfalle)….Fresh made basil pesto, 1 lb of cleaned and deveined lg shrimp, toasted pignoli nuts, heavy cream, diced tomatoes, and fresh grated Parmegiana cheese.

Bring a pot of salted water to a rolling boil

Take your fresh made pesto – place it in a small pot – on very low (simmer) add in about 1/4 cup of heavy cream….you can always add more if you need to adjust consistency…..-stir to mix and then keep warm.

Add pasta to the water and cook until aldente – maybe 8 mins or so. Add in the raw shrimp when you have about 3 mins left to cook.

Strain pasta & shrimp – reserving a mugful of the water. Add back to pot and add back ¼ cup of the pasta water to re-moisten. Stir….(do not have a puddle of water in the pot). Add in the pesto cream sauce and mix well. Serve immediately in warmed bowls – add the diced tomatoes and some toasted pignoli nuts to garnish. Always have extra grated Parmegiana cheese on the table for your guests. A delicious chilled white wine goes great with this meal…..

Buon Appetito.