The Dow Jones Industrial Average rose 119 points and the S&P 500 Index rose 16 points yesterday, after Federal Reserve Chairman Ben Bernanke said in a speech Friday morning that "the Federal Reserve stands ready to take additional actions as needed to provide liquidity and promote the orderly functioning of markets."

About a half an hour later, President Bush announced plans to let the Federal Housing Administration guarantee loans for delinquent borrowers, allowing them to avoid foreclosure and to refinance their mortgages at more favorable rates.

Yet, the major stock market indices advanced on light volume, which suggests that few investors were motivated by Bernanke's and Bush's comments. I also wasn't impressed with Bernanke or Bush's speeches, because any actions the Fed or the Federal Government implements in an effort to stimulate the economy will likely be short-lived. For example, even if the Fed decides to cut interest rates, it can't force banks to lend money, nor can it force debt-laden consumers to take out more loans. And, while Mr. Bush's plans might save some people from losing their homes, those plans can't prevent home values from continuing to decline.

So, as I mentioned in an article on Thursday entitled Don't Get Caught in a Bull Market 'Trap', you should be leery of any short-term gains in stock prices. And, you should keep the following in mind: bull markets tend to "roll over" slowly, as money managers try to convince investors that everything is okay with the economy and that stock market "corrections" - stock market price declines - are healthy.

Well, I see nothing "healthy" about losing money, and when stock prices declines people obviously lose money.

As I also mentioned in Thursday's article, the latest GDP report was no where near as strong as the folks on CNBC would have you believe, with consumer spending and business investments in inventories falling sharply during the second quarter of this year. Although consumer spending rose slightly in July, as compared to the previous month, this major component of GDP slowed for the second month in a row (on a year-over-year basis) - growing at only a 2.5 percent annual rate, versus 2.8 percent in June and 3.0 percent in May. And, my investment models indicate that consumer spending probably fell again this month.

So, enjoy the recent gains, because the most recent rally will likely soon falter again, as portfolio managers continue to rotate their holdings to defensive sectors of the market.