There was very strong demand -- off the charts -- from the indirect bid -- about 65 percent, bigger than the 55.6 percent at the 10-year note auction in November 2005.

Bigger players have multi-million ad budgets. The fact that they have to bid a couple of dollars on key words isn't so attractive to them. However, they can't ignore the size and reach of the audience,

consumer spending has not been dented by the hurricane-inspired rise in gasoline prices and fears of higher home heating oil bills.

It suggests that the industrial production setback reported for June is unlikely to last and that production geared up the very next month.

The red ink was a one-month record in February, and the records are likely to continue to be broken this year. The spending side of the budget ledger remains out of control, despite some effort to constrain these expenditures.

As far as energy prices and core consumer prices, so far it is all smoke and no fire. Rising energy costs have not yet fed into the costs of other goods, despite many anecdotal signs that prices are being impacted.