Another week, another wrap and another pattern for the stock markets. As for the economic data, here is a summary. Euro area industrial output was less than expected in May (up 0.5%, but still 17% down from May 2008) while Euro inflation negative in June on an annual basis. In the US, retail sales also raised by more than expected (0.6 vs 0.5 mom) but only due to auto sales. Housing starts signaling that a bottom may have been reached.

Now, If you couldn?t rely on macro data to push the market up, sometimes surprisingly, earnings had the power to do so. ?And this week, it was all about techs and financials. The ?too big to fail? banks that are left have reported big second quarter profits. Yet, they showed continued weakness in loan portfolios. You still can?t really rely on the economy, but the markets?found their stimulus elsewhere.

Man of the week: Henry Paulson

He recently wrote that he was ?right to pressure Bank of America to complete its acquisition of Merrill Lynch because allowing the deal to fall apart would have damaged the companies and the broader economy?.

He would also say that the he and Treasury Department was right to grant $10 billion in cash to GS and more importantly, full access to the Federal Reserve?s discount window to be a commercial bank.

Remember that the man joined Goldman Sachs in 1974 and became CEO in 1998. Surely, he?s behind the Goldman Sachs ?business model? that relies on risk-taking and leverage.? Now, when one thought that this same business model was deemed irretrievably broken during the global credit crisis, it made an impressive comeback this week (see below). ?Thus, If we?got those big quarter profits this week, it?s?also thanks to Paulson.

Phrase of the week: ?Our model really never changed, we?ve said very consistently that our business model remained the same.?

Lloyd Blankfein. ?Who said: ?The difficulty lies not so much in developing new ideas as in escaping from old ones? ?

Number of the week: 3.44 $ Billion

This is the second-quarter net income reported by Goldman Sachs, or $4.93 a share. That surpassed the $3.65 per-share average estimate of 22 analysts surveyed by Bloomberg and is 65 percent higher than last year?s second quarter. As I?m writing this post, Citigroup also reported strong results for the quarter. After paying preferred dividends and taking into account the selling of Smith Barney to Morgan Stanley, the bank earned $4.3 billion, or 49 cents per share.

Paradox of the week: Google

Google made more money than ever in the second quarter to reach a profit of to $5.52 billion. But the stock is trading down, why is it so? ?Simply because its revenue growth slowed like never before. When you get used to double digit, only 3 percent growth is clearly disappointing. I?m afraid that the difficulty for the markets will be to get used to single digit numbers.

Good news of the week: ?US Housing

The construction of new homes and apartments jumped 3.6 percent last month to a seasonally adjusted annual rate of 582,000 units, from an upwardly revised rate of 562,000 in May. This is the highest level in seven months. In another encouraging sign, applications for building permits, seen as a good indicator of future activity, rose 8.7 percent in June to an annual rate of 563,000 units.

And the global equities are set for best week since May?