Kind of an interesting day, with some good news in the U.S. and a mix of good and bad about equally balanced in Europe. Let’s take one at a time.

The U.S. economy: Housing continues to perform strongly, with house prices up for six months in a row by an average of 3 percent over the past year. Even the worst-hit cities, such as Las Vegas, Phoenix, and even Detroit, have shown price gains. The continued strength in housing hit the front page of the Financial Times (FT) and A3 in the Wall Street Journal (WSJ), and it is a key part of the front-page New York Times (NYT) article, “California Finds Economic Gloom Starting to Lift.” California is often a leading indicator of the rest of the country, so this is particularly good news.

I have been getting a number of questions recently about a number of e-mails and webpages that predict certain disaster. The scenarios include a collapse of the dollar, hyperinflation, confiscation of private retirement accounts, and many other similar things.

The fiscal cliff debate has shifted to some interesting ground. After a good start, with both sides sitting down and announcing that a deal was doable, there has been little visible action between the parties. There has, however, been quite a bit of activity within each party.

— Guest post from Peter Essele, senior investment research analyst

On November 13, I wrote about the richness of the closed-end marketplace due to strong investor demand. At the time, I mentioned that approximately 60 percent of taxable closed-end funds were trading at a premium to net asset value (premiums occur when the price paid in the open market for a particular fund is greater than the value of the underlying securities), which was the highest level ever recorded. In addition, the post stated that, based on historical relationships in this market, these aberrations often don’t persist for extended periods of time. My goal was to highlight the current dislocations that existed and to warn investors regarding a possible correction. Two days later, the number of funds trading at a premium in this particular market went from approximately 60 percent to less than 20 percent, as investors shed these securities at an aggressive pace. In some cases, investors lost more than 6 percent in a matter of days from securities that they believed to be high-yielding “bond” funds.

I haven’t been writing much about Europe recently, and it’s not because there hasn’t been anything happening. There has been. But because most of it has been inside baseball, with little immediate effect (at least here in the U.S.), it hasn’t been as interesting as other developments here.

That largely remains the case, but it’s worth taking a look just to keep in touch with what’s been going on. The big news is that a bailout package for Greece is just about to be finalized. This will be the final bailout, as the Germans are having domestic political trouble getting approval for more cash.

I’ve previously referred to a “confidence disconnect” between consumers and business, and it seems to be continuing. Depending on which stats you look at, sales over the weekend increased between 6 percent and 13 percent over last year, which indicates that consumers are still pulling out their wallets and supporting the economy. But from a business standpoint, although the numbers are quite good at the surface, they may not be as good as they seem.

Several factors make the strong top-line numbers less positive from a business standpoint. The first, and potentially most significant, has to do with whether the sales are profitable. Given the wide range of deals and discounts employed to get buyers to make a purchase, profitability took a hit last year—and it may this year as well. The second is whether strong sales over the kick-off weekend will augur similarly strong results over the entire holiday season, or whether retailers have merely succeeded in bringing sales forward rather than increasing them overall. Evidence from past years runs both ways, and the effect on Black Friday itself was negative, as earlier store openings on Thanksgiving seem merely to have led people to start shopping sooner rather than to buy more goods. The National Retail Federation projects overall sales will increase 4.1 percent this year, which is relatively strong, but it’s less than last year’s 5.6-percent increase.

Today is a slow day news-wise. I expect everyone is doing pretty much what I am: recovering from an overdose of good food and wine.

Once upon a time, a turkey hatched in the dead of winter. He lived in a nice warm coop, had plentiful corn and seeds to eat, and spent much of his poult-hood playing with all of the other little turkeys. When spring came, he and his friends ventured out into the yard and played some more; they continued to have corn and seeds to eat and shelter from the rain. The summer brought more of the same, along with nice people who regularly cleaned the coop, refilled corn and seed stores after the turkeys gobbled it all up, and chased away scary critters like foxes and cats when they got too near.

That’s the only conclusion I can draw from today’s headlines.

First, let’s look at the New York Times (NYT). “Insider Inquiry Inching Closer to a Billionaire” discusses the implication of Steve Cohen, one of the rock stars of the hedge fund and investing world, in insider trading. “Hewlett’s Loss: A Folly Unfolds, By the Numbers” is about Hewlett-Packard’s write-off of nearly $9 billion of the $11 billion purchase price of a company that was, apparently, an accounting fraud.

Yesterday, the stock market cheered the good news on the fiscal cliff negotiations—that everyone was being polite to one another for a change. The market melted back up to the level of, well, last week. Even with yesterday’s bump, though, we are still down about 3.5 percent in the past month, which suggests that investor optimism may be premature. Let’s think for a minute about what the fiscal cliff means, and what “solving the problem” might mean, to see whether this degree of optimism is warranted.

First of all, the fiscal cliff consists of two major components: tax increases and spending cuts. Within those two divisions, there are smaller items. On the subject of tax increases, for example, the impending expiration of the Bush-era tax cuts is getting all the press.