Why high gas prices make our economy look good

Despite the government shutdown, bad weather in lots of the country and more than enough nonsense going on in Washington, the US economy didn’t do that badly in the first three months of 2019.

In fact, growth was pretty good as we’ll probably learn from the gross domestic product report that comes out Friday.

But there’s a big catch, as there often is in encouraging tales.

Let’s follow the Atlanta Federal Reserve’s predictions. Initially, the Atlanta Fed thought the first quarter would grow at a 0.3 percent annual rate. Horrible!

Then, good international trade numbers came in and the forecast was raised to 1.5 percent on March 27. Retail sales, construction spending, the good employment situation and industrial production — as each figure came out, the first quarter GDP estimate kept rising.

The Atlanta Fed now thinks the first quarter will show growth at a healthy 2.8 percent annual rate. That’s about what the experts on Wall Street are also predicting since their forecasts have also risen.

But here’s the catch.

A big jump in forecasts happened on April 18 when the Atlanta Fed shifted from 2.4 percent growth to 2.8 percent projected growth. And that was because of healthy retail sales numbers.

But retail sales, which include fuel, were helped greatly by the sharply rising price of gasoline. According to the Census Bureau, Americans spent $43.1 billion on gas in March, compared with $41.6 billion the month before.

So, that wasn’t really economic growth. And it isn’t a good thing, because consumers will have to spend less on other things to pay a higher price for gasoline and oil.

Certain stock market indexes reached record levels this week.

Remember this: When stocks got this high late last year, the Fed became very nervous and started talking about raising interest rates.

The Fed is concerned not only about cost inflation on things like gasoline but also asset inflation. Stocks at current levels or beyond will worry Fed Chairman Jerome Powell.

But will he be worried enough to incur the wrath of President Trump? It’s a question soon to be answered.

The public says what’s going on in Washington is the most dangerous thing for the economy right now. And, trust me, the situation in Washington isn’t going to get any better in the months ahead.

Act 1 of the Washington drama is now over. Special counsel Robert Mueller didn’t find that Trump did anything illegal.

And — as I and many others predicted — the Democrats and the bulk of the so-called mainstream media were so disappointed that their heads are still aching.

What’s Act 2 going to be?

There will be criminal prosecutions of those who tried illegally to keep Trump from getting elected and from staying in office once he won. The self-proclaimed “resistance” to Trump will now start having its days in court.

The start of Act 2 will officially begin when Justice Department Inspector General Michael Horowitz releases the findings of his years-long investigation in a month or so. But the prelude to the second act has really already begun.

Congressional committees have already looked into what the Democrats did, and criminal charges have already been recommended to the Justice Department.

But Act 2 won’t be the end of this. This is a three-act drama because the Democrats won’t be able to just stand by and let this happen.

That’s why I wouldn’t be surprised if the Democrat-led House files articles of impeachment against Trump. They won’t be able to remove him from office, but the Democrats know that the best defense (against the charges that are coming) is a good offense.

And there’s nothing more offensive than going after the president.

Impeachment also gives the Democrats leverage against Trump and a halfway viable explanation for the criminal charges that are coming. The Democrats will then be able to say the criminal charges are nothing more than retaliation for impeachment — and some people may believe that.

As I said, it’s going to get real interesting. If the economy and the stock market can survive all this, America is in pretty good shape.

This is a bombshell in the Washington chaos-sphere that’s about to happen. Judicial Watch, a conservative think tank with lots of lawyers, announced the other day that a senior FBI official admitted that his agency found Hillary Clinton’s 49,000 “missing” e-mails — in the executive office of the Obama White House.

Judicial Watch says its lawyers learned this from Bill Priestap, assistant director of the FBI’s Counterintelligence Division, in a court-ordered discovery.

I’ve been telling you for nearly two years that Clinton’s personal e-mails weren’t lost, as her side has claimed. That’s because her computer password was stolen by the Russians.

And the Russians were then hacked by the National Security Agency, which ended up with copies of the e-mails.

The NSA offered the e-mails to the FBI, according to my sources, but was turned down because their chain of custody would make them unusable in court.

I guess the FBI finally took the e-mails. If the contents of those messages get out — and they will — there’s going to be mud coming from angles you didn’t know existed.