Closing bell: Dow likes the GDP, sort of (MBI, FRE, FNM)

The GDP number for the second quarter was revised up to 3.3% this morning. The market liked that, but not as much as people might have guessed. The Dow jumped up 200 points, which is substantial, but not an all-out rally.

The problem is probably that no one in his right mind thinks that Q3 and Q4 will be nearly as good. There is too much evidence of falling employment, rising prices, mortgage defaults, and slowing business spending. Being happy about the past is nice, but not when it is coupled with worry about the future. Below are today's unofficial closing bell levels:

DJIA: 11,515.18 (+1.85%)

NASDAQ: 1,300.65 (+1.22%)

S&P500: 2,411.64 (+1.48)

10-Year Bond: 3.7950% (+.0230%)

Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) continued their spikes up. The market is still enamored of the fact that the companies might avoid a government bail-out, which would wipe out common shareholders. Freddie was up about 10% and Fannie 15%.

The monoline insurers got a goose. MBIA (NYSE:MBI) said it would reinsure nearly $200 billion of municipal bonds backed by FGIC Corp. MBI shares jumped 34% to $16.14.

The excitement of the day boiled over into most of the financial stocks. Investors think there will be no recession. Bank write-off are over. All is well with the world.

Douglas A. McIntyre is an editor at 247wallst.com.