What In The World Is Happening this Morning?

Well, right off the bat the futures are down. The credit for this goes first and foremost to the Dear Leader Kim Jong-il and his ever-so-subtle market manipulating strategies. To whit, North Korea has shelled Yeongyeong, a South Korean island about 75 miles west of Seoul. So far two soldiers have been confirmed dead and 17 more wounded, and three civilians have been injured. And by shelling, I mean "...at least 200 North Korean shells hit Yeonpyeong". North Korea has claimed that South Korea started the fight by shelling them first; South Korea did confirm it was "...conducting military drills in the area beforehand but had fired west, not north." There's nothing quite like the prospects of a war that never actually ended flaring back up to ruin everyone's day.

Racing the sun westward we come to Ireland, where Prime Minister Brian Cowen has been forced to come to terms with the fact that his nations is two steps from wandering into Europe with a dirty rag, smearing it on Germany's windshield, and then asking for spare change for "cleaning" it. Part of his coalition government is in negotiations with the European Union and the International Monetary Fund to borrow something like 60% of Ireland's GDP as a bailout. The rest of his government is demanding that he sacrifice his own life that his blood may renew the fertility of the land, or at least that he resign immediately or face a vote of no confidence.

"North Korea shells South in fiercest attack in decades" (http://www.reuters.com/article/idUSTRE6AM0YS20101123)
"Korea tensions weigh on stock futures" (http://www.reuters.com/article/idUSTRE69O1D320101123)

But enough of these foreigners! How are things looking close to home?

Gross Domestic Product is the theme of the hour - or it would be, had the "Dear Leader" not decided to present his son and heir-apparent - the Brilliant Comrade Kim Jong-un - with a bouncing baby resumption of hostilities for no reason anyone can work out (that doesn't involve the sort of megalomaniacal insanity possessed by the dictator of North Korea). Gross Domestic Product is, of course, private consumption plus gross investments plus government spending plus exports minus imports, which is a fancy way of saying it is value of all goods and services produced within a country in a year. The Street savors the sweet, sweet scent of GDP like nothing else because it is the single clearest picture available to tell us how the economy is doing. Is GDP increasing? Let us rejoice! Is GDP failing? Let us offer a fatted calf on the alter of John Maynard Keynes, and look to stimulus to save us!

Last month the initial estimates for Q3 2010 GDP, and the Q3 2010 GDP price index (AKA yet another way to estimate inflation) were released. These figures go through an interesting process of initial estimates the first month, then preliminary revision results the second month, and then final revision results the final month. So whatever we announce today still won't be the final for-real GDP for Q3. But still, the Street loves it some GDP figures, so here we go:

The initial Q3 estimate for GDP was 2.0%, with the GDP price index at 2.3%. In the pre-release hype, analysts were looking for the GDP to be revised upwards to 2.4%, with the price index remaining unchanged at 2.3%. The announcement was due out 20 minutes ago, so how did we do?

The actual release from the Bureau of Economic Analysis may be read at http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm. GDP was revised upwards to 2.5% for Q3, with the price index remaining unchanged at 2.3%. Of that:
* real personal consumption expenditures increased 2.8% in Q3 (an accelerating increase from Q2's 2.2% increase)
* real exports of goods and services increased 6.3% in Q3 (slowing from Q2's 9.1% increase)
* real imports of goods and services increased 16.8% in Q3 (slowing from Q2's 33.5% increase)
* real federal government expenditures and gross investments increased 8.9% in Q3 (slowing from Q2's 9.1% increase)

Good news? Yes. Good enough to overcome the North Korean Crazy Train? Probably not.

At 10, we're looking at Existing Home Sales. We had 4,530,000 units sold in September. The Street is expecting that to pull back a little; they really only expect to see 4,500,000 units sold in October.