Despite all of the happy talk from Larry Kudlow and other Trump administration officials, the data make it clear that the U.S. economy is slowing down. The U.S. economy had an outstanding performance in the second quarter of 2018 (4.2% annualized growth) immediately after the Trump tax cuts. But the performance since then has been all downhill.

The third quarter of 2018 was 3.4%. The fourth quarter of 2018 was 2.2%. The estimate for the first quarter of 2019 is 2.1% as of now (we won’t have the official numbers until late April).

On the whole, it looks like the second quarter of 2018 was a temporary “Trump bump” from the tax cuts and growth is regressing to the same average growth of 2.23% we’ve had since the expansion began in June 2009. That’s the weakest expansion in U.S. history.

The Trump economy looks a lot like the Obama economy and the Fed has failed to find a way to change that. Does declining growth mean we’re heading for a recession?

This article takes a close look at two of the top leading indicators on the economy – stocks and bonds. Unfortunately, the two indicators are sending mixed signals.

The continued rise in the stock market is sending a signal that the economy is fine, growth has stabilized and corporate earnings will grow later this year after a first-half rough patch. The bond market is sending recession signals with falling rates, disinflation and an inverted yield curve (where longer-term rates are lower than short-term rates; usually the opposite is true). Is it boom or doom?

History shows that the bond market indicator has a better track record at predicting recessions than stocks. The most likely outcome is that rates may fall a bit more and then find a floor. Stocks may rise a bit more, but hit the same ceiling around Dow 26,700 where they have topped out three times since January 2018. In other words, expect more of the same.

That’s not great news, but it’s not a disaster, either. Debt is still growing faster than the economy, but a debt or currency crisis may still be a few years away.

Every portfolio should have some cash (to protect against deflation) and gold (to protect against inflation). Then you can sit back and watch stocks and bonds slug it out while still protecting your wealth.

Institutional investors can schedule a proof of concept with the world’s first predictive data analytics firm combining human and artificial intelligence with complexity science. Check out Jim Rickard’s company at Meraglim Holdings to learn more.