Market Report: GDP Glee and Nothing to Fear

They did the mash! They did the market mash! The market mash, it was a GDP smash! They did the mash and it made the dollar crash! They did the mash and it's time to party because the recession is over!

No, I am not sitting around in a pumpkin patch waiting for the Great Pumpkin to appear. What I am talking about is the Gross Domestic Product number. The GDP hit the high end of the market's expectations posting an expansion in the 3.5% range. Yet party today but because we may have to face the reality tomorrow when we'll be singing a new song, Come on baby, don't fear the reaper just take my hand.

Oil regained $80 a barrel on a wave of economic optimism and short covering. Markets prepared to be disappointed after weak earnings from ExxonMobil and weak housing data got better than they hoped for. The fact is that the economy is getting better and the stimulus is doing what the stimulators hoped it would do. Now if we can just figure out what do for an encore. The weekly jobs numbers are getting better but jobs are still the big issue. We cannot stimulate our way to growth forever. We need to find the next driver in our economy that will give us sustainable growth. We just have to figure out what that is.

We have nothing to fear about natural gas supplies. Yet this week's EIA report showed a much smaller than expected injection into storage of 25 billion cubic feet we are still at record storage. The big news is that the Energy Information Agency once again increased the proven reserves of US Naturals gas supplies. The EIA said that proved reserves of natural gas rose enough not only to replace production, but also to grow by almost 3 percent over 2007, largely due to continued development of unconventional gas from shale. Of course on the spooky side the EIA said that, "even though discoveries of crude oil rose for the third year in a row, proved reserves of crude oil fell by more than 10 percent."