Consider these items:

• Gold gets hammered—investors who bought in and created a bit of a bubble worrying about inflation now back off in a general commodity decline as China stumbles and Europe remains mired in recession. The U.S. just keeps printing money and now Japan joins in on quantitative easing after two decades of keeping interest rates at near zero without much impact on the pricing of goods.
• The housing market strengthens in part off pent up demand—a growing population needs more places to live. But much of the home buying in woebegone markets has been by big institutional investors, not Average Joes, who still cannot get mortgages notwithstanding bargain prices either because of bad credit or not enough cash to put down or both. The institutions will rent to the Average Joes in the meantime, but eventually hope to make a killing when Average Joe can afford to buy at a higher price.
• McDonalds reports its global sales are off and value meals are back to increase market share.
• Austerity has not worked in Europe---the latest numbers show even Germany begins to stumble, and now the sequester cuts start to bite into the U.S. economy—the jobs numbers have not been inspiring and our friends, the economists, suggest there won't be a pick up until year end.

Put gold, housing, Big Macs, and sequester together and at best you see signals of weakness rather than strength, and the best we can hope for is more of the same tepid growth we should all just come to accept. Clearly inflation is not a problem— easy money monetary policy has kept the U.S. economy afloat and saved the big banks, but has failed to stimulate a robust recovery. Prices for gold and other commodities fall, because demand ebbs in the general worldwide funk—the countdown is on before China's overbuilt housing market collapses. Since the Average Joe's wages have declined and his benefits cost more, he buys fewer hamburgers and you wonder how he can possibly afford a new home. It follows that those institutions must be prepared to keep newly purchased inventory rented for longer than anticipated, and that could mean lower than promised returns. Sequester promises to weaken the jobs market further—government layoffs and furloughs mean more workers have less to spend--and this should lead to more private sector jobs growth? Well, not if you look at the UK and Europe where severe belt-tightening has starved economies and kept unemployment in the double digits. That's now become a German problem since many of its EU partners cannot afford its products. The U.S. stock market inspires seems to inspire the most confidence—investors like corporate profit reports, but companies make bottom lines look good by squeezing wages, hiring fewer Average Joes, and employing cheaper offshore workers. At some point, buying fewer hamburgers comes back to bite every business not just McDonalds. Is gold a leading indicator for the Dow Jones?

Add into the mix how two half-cocked guys can shut down a major U.S. city using pressure cookers and internet instructions and you should get more of an uneasy feeling. That brings us back to our friends the economists—when they say hiring will increase at the end of the year, we wonder which year they are talking about. Didn't they say that last year too? Or was that the year before last?