Editor's Note: Combining his passions for the markets, humor and food, "What's cookin' with Kenny Polcari" is a blog published twice a week on CNBC.com. With more than 30 years of experience on Wall Street, Polcari provides insight and analysis on the markets, as well as a recipe du jour. Buon appetito!
Congressional leaders said Tuesday a deal to end the partial government shutdown and raise the deal ceiling is within "striking distance." Senate Majority Leader Harry Reid said leaders have "made tremendous progress" and that Tuesday will be a "bright day." Senator Minority Leader Mitch McConnell reiterated and said, "We've had a good day."
(Read more: Senators hint at possible deal on Tuesday)
(Will this be a Cinderella moment, in which the horse-drawn carriage turns into a pumpkin at the stroke of midnight? Speaking of pumpkins, try the penne with pumpkin cream and sausage below.)
But what does it really mean? This proposal would open the government until Jan. 15, 2014, and extend the debt ceiling until sometime in February, allowing "more time" to discuss the budget to reach an agreement by Dec. 13, 2013.
Stocks are very sensitive to the drama, rising and falling with each media appearance by one of the clowns. Markets wants to move on. In fact, it wants to move higher, as it expects better days ahead, and yet remains in check until it gets some clarity and finality. This latest deal would offer little of both, as the fight will only begin again in December.
Can you say KICK THE CAN DOWN THE ROAD?! We are doing exactly what Europe did during its debt crisis. Just let someone else worry about what the future looks like. Can we discuss TERM LIMITS to replace the OUT OF TOUCH legislators that inhabit the Capitol? Why should these men and women make a career out of it when they can't do the very basics? Where is the accountability?
(Read more: GOP to push bill toend shutdown, up debt ceiling)
Is this all just a distraction so that they shift the focus from the weakening economy? Third-quarter earnings season has begun, and with 6 percent of the S&P 500 companies having reported, 55 percent beat lowered profit expectations, a rate still below the historical average. Once again, earnings are mixed at best, with top-line revenue growth missing and earnings beating. But we still have 94 percent more to analyze.
According to research from FactSet, 90 S&P 500 companies have lowered third-quarter expectations. That's the largest number of companies to issue warnings for a quarter since the company started tracking these figures in 2006. This should be a real concern from a valuation perspective, no? If this happens, will we see more downgrades?