In this issue

• While you were sleeping: global equity markets are selling off quite sharply and oil prices soaring amid the political turmoil in Libya; bond market investors are treating this latest series of events overseas as a deflationary shock; cyclical spending is about to go through the proverbial wringer

• The U.S. consumer hibernates? Not even the rally seems to be doing much these days in terms of sparking a sustained wealth effect on spending

• Fiscal contraction is coming … this is a key theme: major budgetary restraint is coming our way in the second half of the year, and so we would recommend that you enjoy whatever fiscal and monetary juice there is left in the blender

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