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DOW – 74 = 18,035
SPX – 7 = 2106
NAS – 31 = 5023
10 YR YLD + .06 = 2.04%
OIL + 1.47 = 58.53
GOLD – 7.20 = 1205.60
SILV – .07 = 16.64

Economic growth slowed in the first quarter. Gross domestic product expanded by 0.2%, down from 2.2% growth in the fourth quarter. The Commerce Department reports consumer spending rose by 1.9%, but economic activity was constrained by bad weather in many areas, the West Coast port closures, a drop in exports (in part due to a stronger dollar), and a big decline in business spending. It is widely expected that the economy will rebound in the second quarter, much like what happened in 2014, when first quarter GDP contracted by 2.1% only to bounce back with a second quarter gain of 4.6%. Exports sank 7.2% in the first quarter, while imports edged up 1.8%. The plunge in oil prices, meanwhile, forced a resurgent U.S. energy industry to retrench. Overall, business investment on “structures” sank 23.1% in the first quarter, the biggest drop in four years. Companies did boost investment on equipment, but just barely so. Equipment spending rose a scant 0.1%.

For all of last year the economy grew at a 3% pace and that dropped down to just 0.2% in the first quarter. We can break it down to three major areas. Weather accounted for about a 1% drop; those winter storms closed roads, and stores, and offices. Some of that lost economic activity will be made up in the second and third quarters, but not all. The strong dollar also accounted for about a 1% drop in GDP. Although the dollar has weakened in the past couple of weeks, it is still fairly strong against major currencies and central banks from Europe to Japan to China are continuing to pump money into the markets and push the value of their currencies lower.  This means we probably won’t see an increase in US exports anytime soon. Oil prices moved to a four month high today, but they were lower in the first quarter and lower oil prices meant less money spent in the oil patch, but it didn’t translate into drivers spending the money they saved at the pump; that knocked about 0.6% from GDP.

But don’t worry, be happy. That’s the Federal Reserve’s new mantra. The Fed’s FOMC policy-setting committee wrapped up its third meeting of the year, and the impression from their statement is that the weak economic data from the first quarter is transitory, the sun will come out tomorrow, don’t worry. The Fed has said they would rely on economic data to determine when they might raise rates, and the first part of today’s statement listed a smorgasbord of weak data. There was no indication that the economy was about to “lift-off”, no sense of urgency to act. So, we do not expect a rate hike at the June FOMC meeting, and futures contracts only seem to give about a 60% chance of a rate hike by the end of the year. The Fed seems to think the economy will come roaring back after a long winter’s sleep. It could happen but it hasn’t happened yet.

Delivering the first-ever speech by a Japanese prime minister to a joint session of Congress, Shinzo Abe laid out his vision for deeper Japanese involvement in Asian security and global diplomacy. He made a pitch for the Trans-Pacific Partnership, a massive free trade deal that the United States, Japan and 10 other countries are now negotiating.

First-quarter earnings are on track to post a slight gain following many stronger-than-expected results. With reports in from 47% of S&P 500 companies as of Tuesday, Q1 earnings are now expected to have risen 0.02% from a year ago, beating a Thomson Reuters forecast for a 2.9% decline. Still, the raised outlook has been mainly attributed to one company – Apple (AAPL). Without the tech giant, the S&P 500 forecast would show a profit decline of 1.6%.

Lumber Liquidators (LL) said it’s been advised the Justice Department is seeking criminal charges against the company relating to the importation of certain products that possibly contain harmful chemicals, and the DOJ probe will likely cost the company about $10 million; the company also faces more than 100 pending class action lawsuits. Lumber Liquidators also reported a loss for the quarter and sales dropped more than 8% so far in April. This morning, the company announced its CFO will resign in June.

California governor Jerry Brown issued an executive order aimed at curbing greenhouse gas emissions, saying it was critical to address “an ever-growing threat” posed by global warming to the state’s economy and well-being. Under Brown’s order, by 2030, emission levels will have to be reduced by 40 percent compared with 1990. Under existing state law, emissions are supposed to be cut 80 percent from what they were in 1990 by 2050. In his State of the State address in January, the governor called for reducing gas consumption by cars and trucks by up to 50 percent over the next 15 years. California’s target reflects those set by other governments, including the European Union, ahead of the United Nations conference on climate change in Paris this year.

The Supreme Court has been hearing arguments and issuing rulings; there have been some high profile cases before the court; the issue of same sex marriage for example. And today, the justices heard a challenge of lethal injection as a violation of the ban on cruel and unusual punishment.

There is another case that hasn’t received much publicity but you might find it interesting. The Supreme Court agreed on Monday to spell out Congress’s authority to give someone a right to sue in federal court, even if that individual cannot show that a specific harm was done. That is an issue under Article III of the Constitution and arose in the case of Spokeo v. Robins, which will be heard and decided in the Court’s next Term.

Under Article III, federal courts only have authority to decide a case or controversy that has something real at stake – a “live” issue, rather than a theoretical claim.  Normally, a case cannot satisfy that requirement unless the suing individual can show some actual or imminent personal injury, or harm.

At issue in the newly granted Spokeo case is whether an individual can sue based on a simple claim that a right created by federal law has been violated, without proof of an additional injury growing out of that violation. This particular case tests a lawsuit by a Californian, Thomas Robins, who sued under the federal Fair Credit Reporting Act of 1970, claiming that an online search engine put out inaccurate personal information about him. The search engine, operated by Spokeo, gathers information about individuals from public sources, such as telephone books, social networks, marketing surveys, real estate listings, business websites, and other databases. It makes the information available to those who search for it online, but cautions them that it does not verify the accuracy of the data.

Robins, who filed a class-action lawsuit, claimed that Spokeo had provided flawed information about him, including that he had more education than he actually did, that he is married although he remains single, and that he was financially better off than he actually was. He said he was unemployed and looking for work, and contended that the inaccurate information would make it more difficult for him to get a job and to get credit and insurance.

A federal judge dismissed his lawsuit, concluding that Robins had not offered sufficient evidence that he was harmed by the information available through Spokeo. The U.S. Court of Appeals for the Ninth Circuit overturned that result, clearing the way for the lawsuit to go forward. It concluded that Congress had created a right to sue under the Act, and that was sufficient to show an injury if a violation of the Act was claimed. The Supreme Court asked the U.S. Solicitor General for the federal government’s views on the case, and the government urged the Court not to grant review. While not embracing the Ninth Circuit’s view of the Article III “standing” issue, the Solicitor General argued that the Ninth Circuit’s ruling could actually be understood as going beyond that to find a genuine claim of injury. The Justices granted review, despite the government’s suggestion.

Litigation makes strange bedfellows. Google (GOOG), eBay (EBAY), Yahoo (YHOO), and Facebook (FB) all filed briefs in the Spokeo case, because of course, they all post information about individuals through their sites, and some of that information might not always be accurate; such is the nature of the internet, or at least that was what the tech companies tried to argue. The companies complain that they process so much data about so many people that the decision opens them up to liability from too many people if they violate the law – as if their control of so much personal data in the first place is not part of the problem.

The brief is fascinating since it details the large number of lawsuits the companies are already facing that they hope a favorable Supreme Court decision could just make go away. Google, Facebook, Hulu, and several other tech companies are facing various and assorted suits, and their defense seems to be that it would be difficult for them not to break the law. The arguments also lay bare the fact that even though there have been laws written to respect our privacy or to protect consumers, the laws are almost never enforced, and they only are considered after grievous harm has taken place; which may serve as a form of compensation but doesn’t seem to qualify as protection.

So, this case is a pretty big deal. If the Supremes overturn the Ninth Circuit, laws meant to protect user privacy, as well as consumer and financial protection laws will become unenforceable. If the Supremes rule with the Ninth Circuit it could change the business model and content of the entire internet.