Republic Risk: DC’s Economic Plan: Buy Votes, Crush the Real Economy

GDP came in well above expectations. That's what happens when you fire money from a cannon and into the hands of all your shock troops in an election year.

Equity Storm Warning Is GREEN on the S&P 500 and the Russell 2000.

Today, futures were mixed after the PCE Inflation figure - the Federal Reserve’s preferred gauge of price stability - came in at 2.9% annually, based on the December figure. According to this morning's numbers, inflation still ticked up by 0.2%. 

The 10-year bond has legged up over the last week to 4.14%. Meanwhile, GDP came in well above expectations, but government spending is sitting at Soviet-Era levels - as in what the CCCP spent to pretend the economy was healthy. We ran a greater than $2 trillion deficit - the best report that money could buy. This only accelerates the debt spiral that appears on the horizon. But remember, the equity markets, along with some gold, are your best hedge. We’ll talk more about monetary inflation next week.