Head for the hills! Sequestration is upon us! In a nation saddled with $17 trillion in debt, a rationale observer might question all of the political clamoring over $80 billion in spending cuts. Alas, we seem to have reverted back to a fiscal cliff-esque stalemate with one political party willing to send us over a “cliff” and the other offering a “solution” of higher taxes – both unappealing options and both packaged with even less-appealing politics. Capital markets fell precipitously mid-month as investors feared that Silvio Berlusconi would reverse austerity measures in Italy after an inconclusive national election. Sentiment improved though as a coalition government seems to be the most likely path forward with bond holders like the ECB still in control. Meanwhile, back in the US, real GDP growth was revised slightly higher to 0.1% versus a prior estimate of -0.1% for the 4th quarter.