And Now for the Good News

As we've noted here many times, the customary pattern for this economy has been one step up and one step back. After the GDP numbers took a step back on Friday, we got the upward step on Monday:

* The Institute for Supply Management said its index of manufacturing industries increased in July for the 12th consecutive month. The rate of increase was slightly lower than in June, but slightly ahead of the analysts' estimates. Drilling down into the details, the ISM's manufacturing employment index was up in July for the eighth consecutive month, and that number was also an improvement over June.

* Manufacturing in Europe was also reported improved in July, and several European banks reported strong earnings. All told, the European recovery is proceeding faster than expected, and may quell fears of a double-dip recession over there.

* And while it's very dangerous to read too much into a single day's stock trading, the market seemed to like all this news. The Dow gained more than 200 points - its best showing for the first trading day of August since 1934.