About an hour after my last post, the US Department of Commerce released it’s final revision of data for US GDP for the first quarter of 2014 … a staggering -2.9%.

Bloggers, twitterers and columnists went into overdrive:

“This is the worst non-recessionary quarter of growth in 60 years!!!” … ZeroHedge

“A Recovery in Need of a Recovery … the worst quarter since the last recession ended five years ago” … New York Times

And what did Wall Street do in the face of this shocking economic news, you ask?

It went up! … here’s the S&P 500 for the day. Note the timing of the announcement and the timing of the market open (courtesy of ZeroHedge):

Why? … because the speculators believe the news will lead to more money being printed by the Fed to feed the already pretty fully blown up bubble stock market.

This is one mighty liquidity bubble … different to the tech bubble of 1999, and the sub-prime mortgage bubble of 2007, but heading towards the same (or worse) catastrophic end.

You know what happens when you just blow and blow and blow into a balloon: first, your cheeks hurt as the back pressure builds, and then …

At the beginning of Q1 2014 the consensus forecast growth for the US economy was +3% according to Reuters. (Hmmm … that was a bit of a miss …) And while the US economy was going through this shocking quarter, the S&P did this:

… not much really … a few nerves in February (when the weather got really bad) … but then quietly pushing on 130 points to be 40 past where it started. And as we saw yesterday, it has since moved on further up to 1950+

Economic fundamentals just are not relevant to the market any more …

… until of course it all comes crashing down, and the “too big to fail” bankers and their ilk set out to socialise their losses by begging for Government bail-outs …

… then we’ll all feel the economic impact, for sure!