* Government's first look at Q1 GDP

* There was a lot of optimism around Q1 with expectations above 3%

* Actual GDP was 1/5 of expectations at.2%

* The rest of the story of Q1 GDP:

* The deflator this time was negative - meaning that prices dropped by .1%

* The last time the deflator was negative was 2009 Q2; still in the Great Recession

* The previous occurrence of a negative deflator was in 1949

* I believe the true rate of inflation is higher than -.1%

* Inventory build continued into Q1 - businesses continue to believe the myth of the recovery

* Inventory to sales ratio are the highest they have been since the Great Recession

* They are still blaming poor economic performance on the weather. It is always cold in the winter; why is bad weather always a surprise?

* The Fed just released their official statement on interest rate policy

* They removed language from statement indicating it is unlikely that rates will rise

* Continuing give the illusion that they are progressing toward a point when they will raise interest rates

* The Fed went out of its way to dismiss all the bad economic news we got in Q1

* The dollar just had its biggest 2-day decline in 6 years

* The Fed came out and put a smiley face on the whole thing and the dollar recovered somewhat

* The Fed is never going to confess that they are worried; that's not their job

* What evidence is there that things will improve in Q2?

* Cheap gas windfall is over; oil prices have risen every week in the past month

* Early April economic data is negative

* An economy based on spending is a bubble; production grows an economy

* Consumers have lots of debt, but they don't have good jobs

* Decline in the dollar signals that the markets are already sensing this

* The Fed feels that economic growth will recover in Q2 & Q3

* They also said they need to see additional strength in the labor market

* Business are making foolish decisions because they believe the Fed

* As the economy disappoints, the labor market will continue to deteriorate

* The Fed can't raise interest rates and they are headed ror QE4

* We need more and more stimulus because we've built up a resistance

* The real crisis will be a dollar crisis

* When the economy heads south and the Fed has to do QE 4, the Fed will lose a lot of credibility

* Janet Yellen will not be able to deliver on her promise to shrink the balance sheet by the end of the decade


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