Even as investors get more and more bullish about the outlook for the U.S. economy, the economy’s underlying foundation continues to erode.

In a report to be released this week, the Obama administration will boost its 10-year projection for the federal budget deficit to about $9 trillion – an increase of roughly $2 trillion, or 29%, from its prior projection, Fox News reported over the weekend, citing a source from the Office of Management and Budget (OMB).

The new cumulative deficit projection – for 2010-2019 – replaces the administration’s previous estimate of $7.108 trillion. Changes in budget projections – whether they result in a surplus or a deficit – are often refined as economic conditions change. This new projection was necessary because the recession has gone on for so long, causing federal tax receipts to plunge – and because the economic rebound will be prolonged and weak, resulting

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For Immediate Release

Chicago, IL - June 26, 2009 - Four free stock picks are being made available today on Zacks.com. The industry's leading independent research firm highlights one Zacks #1 Rank Strong Buy or a Zacks #2 Rank Buy stock for each of the four main styles of investing: Aggressive Growth, Growth & Income, Momentum, and Value.

The four highlighted picks are: The Gap, Inc. (GPS), Lubrizol Corporation (LZ), Green Mountain Coffee Roasters (GMCR) and Dollar Tree Inc. (DLTR).     Today, Zacks is promoting its ''Buy'' stock recommendations. Four daily picks are offered free at http://at.zacks.com/?id=5607

Zacks #1 Rank Stocks have nearly tripled the S&P 500 since 1988, producing an average annual return of +28%. Performance has been notable even during volatile and down times. For example, during the last bear market, 2000-2002, the market tumbled -37.6% - but

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Citi Trends, Inc. (CTRN) shares are up almost 7% today on news that JP Morgan upgraded the apparel retailer to "overweight" from "neutral".

< ?DART(15);?> However, even before the upgrade, earnings estimates for CTRN had been trending higher after a solid fiscal first-quarter report, which continued an impressive streak of better-than-expected earnings.

This Zacks #1 Rank Top Performer is moving on heavy volume this afternoon of about 488,000 shares, compared to the daily average of 259,000.

Good Growth Potential

This Southeastern retailer is one of those niche players that are bucking the overall economic trend. As a result, analysts believe the company could continue adding or expanding stores and, therefore, increase its square footage; hence the recent brokerage upgrade.

CTRN expects to increase selling square footage by at least 15% during its fiscal 2009. Also, in its fiscal first quarter, the company opened

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If history is our guide, then the rally we’ve seen in U.S. stocks in recent weeks is more than just a periodic run-up in share prices – it’s the initial stage of a prolonged bull market.

The 13-week rally the Dow Jones Industrial Average has experienced off its March lows is the most powerful surge that index has seen since the Great Depression. If we look to history, stocks should continue to rally over the next three months.

“I say this with the utmost confidence and my fingers tightly crossed: This is the start of a new bull run,” Hugh Johnson, chairman of Johnson Illington Advisors, told MarketWatch.com.

The 13-week stretch from March 9 through May 29, which saw the Dow soar 28.3%, has been bested only once – by the 40.8% run-up the Dow enjoyed in the 13 weeks that followed its hitting a bottom in May 1932. The

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Here are the stocks added to the Zacks #1 Rank ("strong buy") List today:

ArvinMeritor Inc (ARM) BNP Paribas SA (BNPQY) CGI Group Inc (GIB) Corrections Corporation of America (CXW) The Gap Inc (GPS) Great Lakes Dredge & Dock Corp (GLDD) The Gymboree Corp (GYMB) Henkel AG & Co KGAA (HENKY) Hercules Technology Growth Capital Inc (HTGC) iRobot Corp (IRBT) Jo-Ann Stores Inc (JAS) Jones Apparel Group Inc (JNY) Knology Inc (KNOL) LHC Group Inc (LHCG) LivePerson Inc (LPSN) Marten Transport Ltd (MRTN) Mitsubishi Corp (MSBHY) Papa John's Int'l Inc (PZZA) PepsiAmericas Inc (PAS) Ralcorp Holdings Inc (RAH) Smart Balance Inc (SMBL) Tate & Lyle Plc (TATYY) TRW Automotive Holdings Corp (TRW) Universal Electronics Inc (UEIC) Verenium Corp (VRNM) Vivo Participacoes SA (VIV) ...

Companies cited in this post include D.R. Horton, Inc. (DHI), The Gap, Inc. (GPS) and Harley-Davidson, Inc. (HOG).Below are two graphs that look at the relationship between personal consumption and personal savings and GDP.  The first looks at the year-over-year change in both real personal consumption expenditures (PCE) and real GDP since 1959. Overlaid on that is the personal savings rate. Note that there is a significant change in the behavior of the savings rate from about the mid-1980's onwards.The second graph looks at personal consumption and savings as a percent of GDP (this is somewhat different than the personal savings rate since it is a percentage of disposable personal income, not of GDP). The second graph starts in 1978 to better focus on the period after the savings rate started its secular decline.Notice how closely correlated the change in ...

If there’s a proverb that captures the outlook for the U.S. economy in the New Year, it’s the one that says: “It’s always darkest before the dawn.”

Regardless of any formal announcement of whether or not the United States drops into an actual recession, the ongoing credit crisis guarantees a contraction of the American economy by virtually every measure we know. That period of darkness will be marked by a dramatic slowdown in economic activity, as well as by rising unemployment, additional declines in U.S. stock prices, and constant volatility. It could last as long as 12-18 months.

But when the dawn does come, it will be one to remember. If U.S. President-elect Barack Obama gets it right - and I have every reason to believe that he will - then investors will be presented with the greatest investment opportunity of our generation. At that point, shares of American companies will be

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If there’s a proverb that captures the outlook for the U.S. economy in the New Year, it’s the one that says: “It’s always darkest before the dawn.”

Regardless of any formal announcement of whether or not the United States drops into an actual recession, the ongoing credit crisis guarantees a contraction of the American economy by virtually every measure we know. That period of darkness will be marked by a dramatic slowdown in economic activity, as well as by rising unemployment, additional declines in U.S. stock prices, and constant volatility. And it could last as long as 12-18 months.

But when the dawn does come, it will be one to remember. If U.S. President-elect Barack Obama gets it right - and I have every reason to believe that he will - then investors will be presented with the greatest investment opportunity of our generation. At that point, shares of American

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By all reasonable measures, we are already in a recession, says Shah Gilani. Deflation has become today’s number one threat. But massive government rescues mean another bout of inflation looms on the horizon. Shah says investors should look to short vulnerable stocks in 2009. But in 12-18 months, they should be prepared for a “generational opportunity” to make a fortune.

This from Money Morning:

If there’s a proverb that captures the outlook for the U.S. economy in the New Year, it’s the one that says: “It’s always darkest before the dawn.”

Regardless of any formal announcement of whether or not the United States drops into an actual recession, the ongoing credit crisis guarantees a contraction of the American economy by virtually every measure we know. That period of darkness will be marked by a dramatic slowdown in economic activity, as well as by rising unemployment, additional declines in U.S. stock prices,

...

If there’s a proverb that captures the outlook for the U.S. economy in the New Year, it’s the one that says: “It’s always darkest before the dawn.” Regardless of any formal announcement of whether or not the United States drops into an actual recession, the ongoing credit crisis guarantees a contraction of the American economy by virtually every measure we know. That period of darkness will be marked by a dramatic slowdown in economic activity, as well as by rising unemployment, additional declines in U.S. stock prices, and constant volatility. It could last as long as 12-18 months. But when the dawn does come, it will be one to remember. If U.S. President-elect Barack Obama gets it right – and I have every reason to believe that he will – then investors will be presented with the greatest investment ...