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Soft Numbers

July 29, 2011 – 3:54 pm

This morning the GDP numbers added to the fear caused by the debt ceiling debate. At the opening the market fell again but made much of it back within a couple hours of the opening. GDP for the second quarter came in at 1.3% growth when the expectation was for it to grow 1.7%. Surprisingly, the final revision of the first quarter was down to only .4% growth when it was at 1.7%. Of course those numbers are backward looking so the market will discount them quickly.

Looking forward, growth is picking up. The degree of that pickup is small but it does seem that the direction is up and gaining a little bit of strength from the soft patch we lived through.

Once the debt ceiling issue fades investors and traders may turn to fundamentals, both in our economy and the stock market. At that point the market should recover.

The issue we all have to decide is whether or not the U.S. economy will fall into another recession soon? If your answer is no, buy some stocks. If yes, then get out.

Good Trading
Steve Peasley

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