Japan's yen weakened to 100 per U.S. dollar Thursday for the first time in four years. This was a critical market level, both psychologically and technically, as investors watch to see if "Abenomics" – the policies unveiled by Prime Minister Abe last fall – can finally overcome years of deflation and lackluster growth.

Monetary policy is the cornerstone of Abenomics. Under Abe's reign, the Bank of Japan (BoJ) has taken on a new governor and two new governors, all with more dovish attitudes. Not surprisingly then, this new BoJ has ratcheted up its version of quantitative easing. Hoping to reach a 2% inflation target in two years' time, the BoJ plans to expand its monetary base to 270 trillion yen by the end of 2014. That means that each month, the BoJ is buying almost as many of its bonds (about $76 billion per month) as the Fed is buying with QE ($85 billion per month), but in Japan's case, the buying is occurring with a notably smaller economy (one might call it "more bang for your yen," or "more QE per capita").

The U.S. Federal Reserve and the European Central Bank (ECB) are faced with opposite policy problems that will exert a greater and greater influence over the forex market in the next several months.

I expect the different stances of these two central banks to push the euro/dollar out of its recent trading range on the downside.

First let's take the Fed. The big debate at the Fed's March meeting, according to the minutes released in mid-April, was whether to "taper off" quantitative easing (QE) or not. Then the statement from the April meeting shifted the debate to the left when it said "the committee [Federal Open Market Committee] is prepared to increase or reduce the pace of its purchases to maintain appropriate policy accommodation…" The question became not whether to taper off or not, but whether to loosen further or to taper off.

But as usual the FOMC's statement also said that it would continue with QE "until the outlook for the labor market has improved substantially." That adds another question for the Fed: how do you define "substantial?" The April nonfarm payrolls data showed jobs have been rising an average of 200,000 jobs a month over the last seven months, versus only 130,000 a month as recently as last September. Does this qualify as "substantial"? Jeffrey Lacker certainly thinks it does.

Lacker, president of the Federal Reserve Bank of Richmond, Virginia, said about the figures, "I don't think there is any question...that we've seen substantial improvement in the labor market outlook over the last 6 months." Note the use of the phrase "substantial improvement." And just in case you missed the point, he added, "I think you ought to evaluate the likelihood of us reducing the pace of asset purchases accordingly."

As you read news headlines and listen to and watch media reports on the market, it's important to recognize that language may have different meanings depending on your perspective. Just last week the media reported that J.C. Penney stock "soared" 11 percent—on the surface that seems to be a positive enough development.

While "soaring" is certainly more positive than "plunging," soaring suggests good news at J.C. Penney and for most investors this is how they will take the headline. Those investors will not look below the surface for the complete story.

Discord and petty rivalries among the euro area political leaders have left the European Central Bank (ECB) as the only effective manager of the monetary union's ongoing economic crisis. The ECB's leadership is perhaps also the best hope of bridging the political, economic and psychological fault lines in a union where understanding and cooperation were supposed to be the hallmarks of a new, fraternal Europe.

Confusion and disarray that followed the onset of the euro area crisis in late 2009 showed that political leaders were totally unprepared to deal with systemic problems which, for years, were well known to all of them. Indeed, the disastrous state of Greek public finances and the crippling exposure of Spanish and Irish banks to the souring real estate booms were not sudden discoveries.

"They just let the thing go" is what the former ECB President Jean-Claude Trichet said about the euro area leaders' failure to deal with these problems in a timely and effective manner.

(Read More: Why Fed, ECB's 'Great Job' Is Not Enough)

It then fell to Trichet's ECB successor, Mario Draghi, to show leadership the heads of state and government were unable to exercise, partly because some of them apparently wanted very stringent lending conditions for countries which far exceeded the budget deficit limits (3 percent of gross domestic product), and who failed to properly supervise their banking sector.

And punish they did. Frightened by the prospect of an imploding monetary union, financial markets imposed default-like bond yields, and an enraged public threw out the sitting governments in Greece, Ireland, Portugal, Spain and Italy. But "throwing the rascals out," as the popular saying goes, was just the beginning. What followed these government changes were deep budget cuts, tax hikes and unemployment-boosting structural reforms to allegedly restore investor confidence the euro area leaders destroyed with their indifference to obvious signs of a brewing crisis.

Reassuring Investors

That is when the ECB's new President Draghi stepped in. He cut interest rates as soon as he took the helm of the bank in November 2011. More radical measures followed: it was only during his second monthly meeting of the bank's governing board that he announced unlimited funding of the euro area banks. And then he fired the big bazooka on July 26, 2012, when he issued his famous pledge to do "whatever it takes" to support the euro.

We may not have needed more evidence that password-based security is as vulnerable today as it ever was.

But we got it anyway when a bogus tweet was posted from a hacked Associated Press Twitter account. According to the tweet, there had been explosions at the White House and President Barack Obama was injured. The markets sent the markets into panic mode and a 143-point free-fall in the Dow Jones Industrial Average resulted. (The report was false of course, and corrected by the AP within minutes).

(Read More: The Trading Robots Really Are Reading Twitter )

The apparent culprit —"Syrian Electronic Army" (that's who took responsibility)—went spear-phishing and hooked a big one. They targeted specific AP employees who hold sensitive data—Twitter passwords, for example—and sent legit-looking emails from trusted parties, even touting a competitor's news story as bait. One click on the innocuous-looking link within and the world's oldest and largest news organization was hacked—simple as that.

(Read More: Twitter Trading: 8 Tweets That Moved Markets )

We'd all like to think we'd be vigilant enough not to click such a bogus link and touch off such a calamity. But the temptations are cleverly produced and such incursions have created chaos at the BBC, NPR, "60 Minutes," Washington Post, Wall Street Journal, and Reuters as well as the AP, and those are just the news organizations we know about. All of the organizations are staffed by smart and savvy, cautious people and all have been embarrassed by reliance on the security workhorse of our day—passwords.

If you're an IT professional, chances are you are not surprised. You have probably known for some time and maybe even lost some sleep over the realization that password systems are badly flawed.

A new McAfee global survey recently published finds 55 percent of senior level security professionals think username / password combinations have grown so insecure, they're no longer appropriate for managing access to critical enterprise data. Only 11 percent still maintain full faith in passwords. And 83 percent fear their organizations are at risk for a severe security breach.

Another McAfee survey this year found on average, Americans have 10 password-protected Internet accounts, but use only five unique passwords to protect them. A fifth of all Americans have a whopping 20 password-hungry online accounts.

When there's too much to remember we do what's natural. We reuse passwords, or employ easily guessed words. When system protocol demands we invent something tougher (with numbers, #@!-type characters, or both: $Wombat394#*, anyone?) we write them on Post-its and stick them to our screen. Or we forget, and waste time resetting again and again—the McAfee survey found a quarter of Americans have been through the password reset shuffle at least three times in the last three months.

This behavior matters at the enterprise level because so many workers connect their personal devices to the company data cloud, and other cloud resources that IT sometimes doesn't know about. Each off-the-reservation device, and each cloud connection, presents a hacking opportunity. Get speared by a spear-phisher, of course, and all the precautions and $&@!-inclusive passwords are for pointless anyway.

Twitter doesn't offer "two-factor authentication"—where users must bring a second form of ID—although reports since the AP hack suggest they are considering it. Other technology names like Apple and Google have already taken the plunge. With the increasingly indispensable role Twitter plays in data dissemination—Wall Street money movers check Twitter constantly for market news as they trade—it may finally be time.

At the enterprise IT level, however, the pros in our survey think replacing everything with multi-factor authentication would take too much time and money without proving sufficiently bulletproof. They say the unwieldy password systems they've got already consume too much bandwidth.

But solutions are on the way that will make a better mousetrap: automated, improved, and simplified access controls that raise the game.

Some security solutions include technology that facilitates centralized authentication and tools that monitor and audit user activity. There are also SSO (single sign-on) solutions for cloud access, ending the often-seen requirement of separate, discrete passwords for separate, discrete applications—which can drive frazzled users to too-convenient workarounds. And biometric authentication has improved dramatically and is near ready for prime time. It can offer a genuine paradigm change—one that can leave the spear-phishers with empty nets.

Passwords have had a good, long run. They date from the dawn of consumer computing. But today the landscape is different and the cost of breaches potentially terrible. A next-generation approach to data security is overdue. It will be welcome news.

Just ask the Associated Press.

—Pat Calhoun is a digital security expert and Silicon Valley veteran who is responsible for the strategic direction of McAfee's network security business unit. He can be followed on twitter at @calhoun_pat.

We are about half-way through earnings season, so it seems like a good time to provide a preliminary evaluation of the results.

About 235 of the 500 companies in the S&P 500 have already reported results for the first quarter. Among these companies, roughly 74% beat the consensus expectation for EPS. The average overage has been 4.61%, which is slightly below the average beat for the past eight quarters. In general it seems that companies continue to sandbag their earnings guidance and they continue to beat those modest expectations.

Perhaps the more interesting metric to follow is revenues. Among the 235 companies that have reported, only 45% have beaten the consensus expectation for revenues. This means that 55% have missed expectations, with the average magnitude of the miss at 1.15%. Looking back over the past several quarters, we find that a pattern is developing: Despite the fact that companies are still beating their EPS expectations rather handily, they are increasingly falling short of top line expectations.

This week we experienced another meltdown moment, with someone hacking a Twitter account and tweeting a possibly malicious and certainly false message about explosions at the White House and an injured president.

Predictably, people in the markets wrung their hands and watched the Dow tumble more than 100 points. Commodity futures dropped by a like percentage. Folks then figured out the tweet was a hack hoax, and the markets recovered everything they had lost.

Here are the marching orders: "China needs to cement its domestic economic growth momentum and guard against potential risks in financial sectors."

Thus spoke last Friday China's party bosses (Politburo Central Committee) in a clear, topical and timely message of measurable performance objectives addressed to the country's new government. The message captures two key issues: economic growth and stability of the financial system.

Growth has been brought down to more sustainable levels after two years of cutting inflation from 6.5 percent to 2.1 percent and fighting rampant property market speculations. Declining export growth from nearly 30 percent in 2010 to less than 6 percent last year has also tamed one of the powerful sources of aggregate demand.

In spite of that, with a growth rate of 7.7 percent in the first quarter, the economy still remains well within the official target range of 7-8 percent. The government, and the markets, can, therefore, take the message to "cement … economic growth momentum" as an invitation to stabilize the economy within that growth interval.

(Read More: China's Growth in Question as PMI Data Loom)

Unless the new politburo members believe, as some observers do, myself included, that China can grow a bit faster because this target range is probably somewhat below the economy's noninflationary growth potential. That is the implied meaning of the consensus estimate for this year, which calls for a growth rate of 8.5 percent. Some official international organizations go even further by expecting significant growth acceleration to about 9 percent.

Both scenarios leave the Chinese government quite a bit of room to repeat its old "under-promise and over-deliver" routine.

Looking for Quality of Growth

In the meantime, here are two questions. First, can China step up the growth rate from its current level? Second, does China want to grow much in excess of its 7-8 percent target range?

The answer to the first question is an emphatic yes. China's monetary and fiscal policies have plenty of room to ease. Inflation at 2.1 percent is significantly below the central bank's target of 3.5 percent. The budget deficit is 2 percent of gross domestic product (GDP), and public debt is 22.2 percent of GDP, virtually unchanged over the past five years. The household debt stands at less than 30 percent of GDP.

(Read More: China's Credit Bubble: Where Did All the Money Go?)

The answer to the second question is a qualified no. That is what transpires from the recent statements of policy intent by both the new prime minister and by the central bank's governor.

The emphasis in both cases is on stable and sustainable (noninflationary) growth. Prime Minister Li Keqiang recently spoke of the need to "improve the quality and benefits of economic development" as China seeks to reduce its reliance on exports, and to shift more resources toward domestic demand – household consumption, infrastructure and social welfare services.

A similar statement was heard from the People's Bank of China (PBOC) Governor Zhou Xiaochuan during his last week International Monetary Fund (IMF) appearances. He said that China's first quarter growth was "normal" and insisted that this year's growth target of 7.5 percent is in a range that will provide stable (read: noninflationary) economic environment for structural reforms.

Most Americans don't understand all the ways that Social Security can benefit them, and no wonder — Social Security is an enormous, complex system that covers retirement, disability and death, with rules that are under-explained and confusing.

As a result, many recipients find out how to maximize their benefits only after beginning to receive them – when it is too late to change their elections.

(Read more: How to Make Tax Season Less Stressful — Next Year)

Here are four things that you need to know to maximize your Social Security benefit before you begin receiving your check.

You can receive benefits even if you never paid in. Spouses who have never worked (meaning they never paid Social Security taxes) may still be able to get retirement benefits under Social Security. You need to be at least 62 years old and your husband or wife must be eligible for retirement or disability benefits to apply. This second payment can significantly add to the total amount couples receive.

You may choose to a payment equal to half of what your spouse gets. If your spouse made more than you did in the course of your lives, his or her benefit is most likely higher than yours. When you apply, you can elect to take the benefit calculated on your salary, or one-half of your spouse's higher amount, without affecting your spouse's benefit. This can provide a much higher total benefit for working couples.

Wait to receive your benefit, and it continues to grow. Consider delaying benefits if you do not need them immediately – the additional income down the road may be significant. Benefits are increased by a certain percentage (depending on your date of birth) for each year that you delay your retirement. The increase can amount to up to eight percent more for each year that you wait to retire.

You may start receiving benefits before your spouse is retired. As long as your spouse has reached full retirement age (typically between 66 and 67), he or she can file for a benefit but suspend it. As your spouse continues to work and that benefit continues to grow, you may start to collect.

(Read more: Social Security Cuts: 'Hard to See as Humane')

By simply doing a little homework, you can make educated decisions about your Social Security and avoid mistakes you will have to live with for the rest of your life. Start by creating an account on the Social Security Administration (SSA) website. Check to make sure that the administration has recorded your work and earnings history accurately, as your retirement benefit is based in part on this history. Check back periodically to be sure the information stays accurate.

As you get closer to retirement, discuss your options with a financial planner or make an appointment with someone at the Social Security Administration.

Geoffrey S. Cable is managing director at Destination Wealth Management.

Called the "Queen of Real Estate" and even "Jaws" for her aggressively successful tactics, super broker Dolly Lenz has sold over $8.5 billion dollars in high-end properties, catering to clients like Barbra Streisand, Billy Joel and P. Diddy.

Now she's revealing five tips to buying a million-dollar home.

In A Buyer's Market: Be Aggressive

In a buyer's market, sellers have fewer options. Buyers are scarce and therefore, they have the upper hand in that they are better able to dictate terms.

In this instance, buyers can be aggressive in their bidding and are free to probe how motivated a seller is to sell. In this environment, buyers should consider asking the seller to pick up certain closing costs, include furnishings as part of the deal, and even request seller financing.