GDP +2.6% vs. estimate of 3.2%, Consumer spending up 4.3%

Financials: Mar. Bonds are currently 18 higher at 150’31, 10 Yr. Notes 17 higher at 130’23 and 5 Yr. Notes 10 higher at 121’06.2. GDP was disappointing at +2.6% vs. an average estimate of +3.2%. Consumer spending was constructive showing an increase of 4.3%. We are currently short the 5 Yr. Notes from above the 120’25 level and short the June 2017 Eurodollars which are currently at a loss.

Grains: Mar. Corn is currently fractionally higher at 372’0, Mar. Beans 1’0 higher at 969’0 and Mar. Wheat 3’2 at 511’0. Beans have reached my downside objective of the 965’0 area and my bias has now turned to the long side of the market. I will be a buyer on a 10-20 cent break. We remain short the Mar. Corn 380’0 strangle of which we collected 16’4 cents. If this position is making you nervous I suggest buying the 360’0/400’0 strangle for protection.

Cattle: Yesterday Apr. LC closed 92 lower at 150.67 and May FC 90 lower at 205.00. Over the past 2 day the Apr. LC has given the opportunity to sell resistance in the 151.75 area. If you remain short (market traded as low as 148.52, close to the 148.00 support level) either take profits or use a protective buy stop at 151.40.

Silver: Mar. Silver is currently 21 cents higher at 16.98 and Apr. Gold 10.00 higher at 1266.00. Yesterday these markets broke sharply on both deflationary fears and a strong Dollar. I feel this is a buying opportunity and established a small long position.

S&P's: Mar. S&P’s are currently 18.00 lower at 2000.50. Yesterday’s low of 1982.00 has approached our target of the 200 day moving average of the 1963.00 area. I will be a buyer below the 1982.00 level and a seller above 2017.00.

Currencies: As of this writing the Mar. Euro is currently 13 higher at 1.1328, the Swiss 8 higher at 1.0843, the Yen 60 higher at 0.8511 and the Pound 23 higher. I still like the long side of both the Yen and the Pound. Treat the Euro as a trading affair between 1.1170 and 1.1420.