Major averages rose yesterday on lower, below average volume with the NASDAQ Composite closing just under its 200-day moving average. Reports this week remain on the light side, so absent any major news, a low volume rally or "melt-up" would not be surprising as we move through this Christmas holiday shortened week. In any case, if one has not made big money already this year, it is not likely that this week will offer many opportunities to do so as things slowly quiet down heading into Christmas Eve. Futures are up slightly at the time of this writing.
Third quarter GDP growth numbers were announced this morning, but are having little effect on the market. With the usual 2% number being released, we have to remember that because the government understates inflation based on the contrived and constantly changing way it calculates it, it therefore overstates GDP growth that is simply attributable to inflation. Therefore, real GDP growth is likely much lower than the 2% growth that the government claims occurred in the third quarter.
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