Morning Report: GDP revised upward on inventory build

Vital Statistics:

	Last	Change	Percent
S&P Futures	2073.0	-11.2	-0.54%
Eurostoxx Index	3380.9	-64.4	-1.87%
Oil (WTI)	42.58	0.8	1.99%
LIBOR	0.382	0.005	1.19%
US Dollar Index (DXY)	99.54	-0.264	-0.26%
10 Year Govt Bond Yield	2.23%	-0.01%
Current Coupon Ginnie Mae TBA	104
Current Coupon Fannie Mae TBA	103.4
BankRate 30 Year Fixed Rate Mortgage	3.93

Markets are lower this morning after Turkey shot down a Russian plane in Syria and Brussels stays on lockdown. Bonds and MBS are up small.

The second revision to third quarter GDP came in at 2.1%, in line with estimates, and up from the initial 1.5% estimate. Personal consumption rose 3.0%, a little below expectations, while inflation was slightly higher. Inventory build accounted for a lot of the growth, which means the third quarter may have "borrowed" some growth from Q4. 

Consumer Confidence took a big hit in November, falling from 97.6 to 90.4,

The Richmond Fed Manufacturing Index fall to -3 from -1 in November.

The S&P/Case-Shiller index rose .61% in September and is up 5.45% year-over-year. 

The Allergan / Pfizer merger has brought out all the usual suspects jawboning about "corporate patriotism." It is another inversion trade, where the larger Pfizer is getting bought by smaller Allergan in order for Pfizer to change its domicile to Ireland and lower its effective tax rate from 25% to 17-18%. The companies sure made themselves a target by doing this in an election year, however the reality remains: the US has the highest corporate tax rate in the world, and we double-tax foreign income, which most countries do not. Until corporate tax reform happens, these sorts of things will continue.