Today’s GDP Report

As many of you know, I’ve been saying that the economy is much stronger than a lot of experts think. When the first report on third-quarter GDP came out last month, I wrote: “According to surveys, Wall Street’s estimate for third-quarter GDP growth is 3.6%. That’s way too low. I expect to see a number over 4%. In fact, I wouldn’t be surprised to see a number over 5%.”
It turned out to be 3.8%. I still thought that was too low. Today I found out that I was right. The government revised GDP growth higher to 4.3%. Today’s report suggests that economic growth is accelerating—the rate of growth is itself increasing. Also, inflation continues to be benign. This is excellent news for investors.
The market is down a bit today. Quality Systems (QSII) is taking a hit due to an analyst downgrade. Our Buy List is holding up well so far. All told, November has been a great month for the Buy List. I’ll have final numbers later today, but we should be up around 6%, and the S&P 500 is up about 4% (that doesn’t include dividends). Also, Donaldson (DCI) is rallying on its strong earnings announcement from yesterday.

Posted by on November 30th, 2005 at 1:08 pm

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