It was only 32 days ago that the market was rocked by the GDP numbers. Remember that? According to all happy talk today, the upward revision we got this morning is a big reason for the “huge” 0.5% move in the S&P 500. If it wasn’t so sad, it would be funny. Do people really believe these numbers? If they believe them, do the numbers mean anything? I guess they do matter to people that must be a lot smarter than me.

Just remember this is a gift that keeps on giving. On October 27th, we got the 1.6% GDP number for the 3rd quarter, but that was just the “advance” GDP. The advance estimate, got revised upward today to 2.2%. Yippeee! It’s bad, but not too bad. Maybe by the time the next and “final” revision comes on December 21st, it will be less “badder.”

It appears that this iterative process of market reaction to the same lousy data has identified the exact point (plus or minus a few bps) where we fear recession (the old 1.6% GDP) and where we are convinced there is no recession possible (today’s 2.2%). Since the concensus estimate of economists prior to the October 27th release was 2.1%, any number less than that would have been a negative surprise and that is what we had. Based on all this info, my guess is that the ideal GDP is somewhere between 1.6% and 2.0%. There you have it. Any GDP that fits snuggly in that range, but preferably closer to 2.0% will be “just right.” Maybe we should rename GDP so it actually stands for Goldilocks Determined Product.