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Paging Ms. Goldilocks ...
The economic porridge these days is tasting just right for the stock market.
November 28, 2005: 9:08 AM EST

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NEW YORK (CNNMoney.com) - For investors in stocks, it looks like the week is shaping up to be a good one.

The Dow is aiming at its highest level since 2001, the myriad economic reports due this week are mostly expected to show expansion, and the first shopping weekend of the holiday season came in good enough to spur optimism.

For bond investors, the outlook is trickier. If the stock market performs well and the coming economic numbers look good, then pressures may build again for bond yields to climb back about 4.5 percent and even higher. So far inflation numbers have stayed tame ... even with GDP growing above what many Fed officials think its trend rate is.

Will this continue? If the fourth quarter economy cools off as some predict, it probably can.

Several Fed speakers at the end of the week -- including soon-to-be emeritus chairman Alan Greenspan -- will give us a clue as to what they see, as will the Beige Book earlier in the week.

The Goldilocks economy, that's what we called it in the 1990's -- not too hot, not too cold, but just right. Maybe she's back, at least for awhile, meaning the bears may be out in the cold and the bulls will enjoy a happy holiday season.

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Kathleen Hays is economics correspondent for CNN. Read more of her columns here.  Top of page

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