U.S. stocks are higher this morning after a strong earnings report from Alcoa gave a good start to the Q4 earnings season. Global markets continue to focus on the European sovereign debt problems which do not seem to be going away anytime soon. China and Japan were out in support of buying European financial aid debt, but one has to wonder how long this can go on. In reality it is the taxpayers of Germany and France that end up paying for these bailouts. If this were in the U.S. it would be similar to California asking Texas to help pay for California's spendthrift ways.Bond prices are faltering today with mortgages approximately .25% worse in price from the close on Monday. Later today the U.S. Treasury will auction $32 billion of 3 year notes so stay tuned, we could see additional volatility if demand is weak.And finally, the U.S. Federal Reserve made a record profit last year of $80.9 billion, sending $78.4 billion to Treasury. The Fed's 2010 interest expense was just $2.7 billion while operating expenses were $4.3 billion. This seems like a no-brainer business; create money out of thin air, buy bonds and collect the interest.