This morning there was more news of slowing growth in manufacturing in both Asia and Europe as well as last week’s news that durable orders shrank. The Unites States Purchasing Manufacturing Index (PMI) had a below 50 reading which translates to a contraction. The markets are currently shaking off all this bad news and moving slightly higher but this is not good news for the 3rd qtr GDP report, which from Granite Group’s perspective maybe below expectations. In China we have seen seven straight months of contraction. In Europe, while there was some stabilization from Germany, Spain and others, the UK saw an unexpected drop. We do not see this changing anytime soon. The S&P’s 4th highest run in ten years has ignored the data in favor of QE3 and inexpensive market valuations. Granite Group believes with a fair valuation at hand the markets might finally stall when equity owners wake up and smell the coffee.