[click here to enlarge--from ZeroHedge]
Figures released this morning indicated that U.S. stocks, up over 2% since yesterday's lows, are into some serious Kool-Aid. First, a revision of the government's estimate of third-quarter GDP suggests that economic growth may soon go from anemic to nonexistent. Increases in personal disposable income, business investment, and real final sales--the things that we want to go UP--were revised downward. Government expenditures and unsold inventories--which we would like to see go DOWN--were up. With stats like these, no one is expecting Q4 GDP to match Q3's.
Also headed in the wrong direction are initial unemployment claims. The four-week moving average (chart below) has reversed back up over 400,000 for the first time in over a year. With consumer spending accounting for roughly 70% of GDP, it is hard to see how things will get better soon.