"I don't like that man. I must get to know him better." -- President Abraham Lincoln

Let that one sink in, gang. Always worked for me.

Immediate Risk

Amazon (AMZN) , Alphabet {Google} (GOOGL) , Western Digital (WDC) . Take 'em, take 'em, take 'em. Intel (INTC) , Microsoft (MSFT) , and Starbucks (SBUX) . Hmmm. Might have to think a little bit on those names. Not to mention that big oil reports this early morning. Know what else traders are going to have to ponder today? The Federal government's ability to fund itself, and the growth of the home team economy. Booooo. Nobody likes to think about these things. These items are certainly not as easy to analyze as are equities, and they certainly are not sexy in any way. Truth is, without them we don't even have a field to play on. So, put on your deuce gear. We're going in.

Forget traders, people in general don't like to think about government shutdowns or gross domestic product all that much. These items are not part of the every-day risk assessment that most folks, even in this business, run through as they mentally prepare for a day's work. As for the public, they probably don't think about this stuff at all. So, why the hubbub? Healthcare reform appears to be off the table for the moment (maybe forever?), putting off a longer-term budget deal. As House Speaker Paul Ryan has told you (ain't he grand?), even if both sides suddenly agreed on all issues, the House would need three days to vote on a proposed bill because they would need to read said bill. (Guess pulling an all-nighter may be asking a bit too much from this crew.)

Regardless, this will all make a congressional vote necessary today in order to pass that one-week funding bill that we mentioned in yesterday's morning note. Without this stopgap measure, the federal government's funding will expire at 12:01 tonight, or should I say tomorrow morning. If passage of the one-week bill starts to look shaky this afternoon, there will be a certain level of risk priced into both equity, and debt securities. Gold will go the other way, and gold futures will likely be watched today as a short-term indicator. Then, gang, we can do this again in a week.

We do not love first quarters here in the United States. I mean, generally speaking, we're just not good at them. Either we, as a nation, are just unable to crank up the economy in the wake of the holidays, or our seasonal adjustments for the winter months are simply incorrect. Either way, I think it's obvious that consumer activity has slowed, and will continue to be the most focused upon player in this economy. The Atlanta Fed's GDPNow model is forecasting a print for today of 0.2% quarter over quarter, seasonally adjusted and annualized. Most private economists are a bit higher than that, with the majority of them in between 1% and 1.5% on this item.

The fact is that the FOMC is watching. We all know that they want to sneak in another increase for the target of the fed funds rate in June, and then maybe another later on, or tackle that balance sheet that nobody can agree on how to manage. That all goes away with an especially weak measure of national economic growth, as does the banks' aggregate ability to make their full-year numbers. Such a scenario also puts much more focus on the second quarter and on stalled administration policy goals aimed at stimulating growth. This print matters to you today more; so than does the NFL draft, gang, so shake out the cobwebs.

The Friendly Skies

What was that? A pay raise! Thanks, boss! American Airlines (AAL) beat expectations yesterday for earnings per share, and revenue. Then the stock took a swan dive off the high board, down a brutal 5.2% after hitting a low that was 8.6% off of Wednesday's closing price. AAL proposed a health pay raise for its flight attendants and pilots. This comes years prior to when the firm might be forced by expiring union contract to make such a bold move. What gives? Well, while this will likely make for a happier labor force within the firm, shareholder value was dragged lower across the industry. Down went Delta (DAL) , down went United (UAL) , down went Southwest (LUV) , along with JetBlue (JBLU) , Alaska Air (ALK) , and down goes Frazier.

One thing is certain. The industry changed with this news. The airlines are part of the growth story. Already rising labor costs are a problem across the business. Does this change the story for the "long and wrong" crowd? I remain long DAL and LUV myself, and I received more reader e-mails on this topic last night than any other.

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