Boy, was my prediction wrong!

"Stocks rise as weak GDP suggests Fed pause." The economy grew at a 2.5% annual rate, which means that the quarterly growth was --0.15%. I must admit, I didn't see the economy slowing this much. Part of the reason the number was so low was the rise in inflation.
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core personal consumption expenditures, a gauge of inflation, quickened 2.9 percent in the quarter, up from a 2.1 percent pace in the previous period
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Since inflation is subtracted from GDP, it should have come in at a 3.3% rate. This means that the economy is losing the battle with inflation. I was expecting a recession in the spring of 2007, but now I think we might be there in the fall.

I think I will use this rally to increase my short positions. Yesterday, I sold off my longs in ACAS and MCGC. I will move some of that over to ALD because they have a much lower debt to equity ranking and because their increased dividend tells me that their cash flow is strong.