Consumer spending makes up about 70% of the U.S. economy and seems to be doing well. Retail sales grew solidly in July, up 8.5% over the past year. In the most recent report, sales for May and June were revised somewhat higher than the original figures. Surveys of consumer sentiment point to despair, but we follow what people do with their money rather than what they tell a pollster. The fact is, they are still out spending even as they wring their hands over the economy.

Manufacturing also appears to be growing steadily, though employment was dead flat in August. The statistics paint a picture of an economy that is growing at a very modest rate, but growing nonetheless. Second quarter gross domestic product grew at an annualized rate of just 1%. Slow and unsatisfying growth is still much different than a recession.

The market may very well remain volatile in the near-term as occasional positives about modest improvement in the economy help a little, while concerns over the European debt situation and occasional negative economic blips here cause the market to give a little back. We don't believe that the precursors exist for the feared "double-dip" recession, but clearly the odds of one are higher than they were six months ago, when economic indicators appeared stronger.

We focus the bulk of our attention on companies that create much of their own growth, rather than needing a significant lift from the overall economy. We can't control what happens in the economy or market in the short-term, but we can choose to be in companies that are less exposed to areas of weakness.