The strong performance is attributed to bits and pieces of good news.

The series of good news started with a coordinated move by major central banks to provide US dollar funding at a cheaper rate.

Then a positive sentiment came from Europe, that politicians are working hard to resolve their debt crisis before the EU summit set for Dec. 9.

The week ended with American economy adding 120,000 jobs and unemployment rate dropping from 9 percent to 8.6 percent.

Most analysts say that most of the market reaction is accredited to the positive European signals.

The problem with the unemployment rate drop, not playing a major role in this rally, is the discouraged workers factor.

While the American economy has added more jobs last month, more people have stopped looking for jobs. These people get excluded from the working force, creating a rosier picture in the unemployment rate.

This was clear in President Obama's speeches, commenting on the latest job market statistics, focusing on the creation of number of jobs and avoiding any reference to the unemployment rate.

As the American economy starts recovering, these discouraged workers will start looking for jobs again, and they will be added with new graduates to the labor force.

Moreover, the unemployment benefit claims have shown an unexpected increase.

The most affected sector by the recession of 2009 is the construction sector, which is still losing jobs.

Obama's plan is to reignite the construction sector by turning American houses green, making it consume less energy and generate some of its needed energy.

But the efforts in applying such technology are scattered, and there is little coordination happening between different government agencies and the private sector.

While listed companies keep posting record profits, its ability to create jobs is limited.

The US economy depended on companies that have business models focusing more on the bottom line results, rather than making goods; Apple is an example.

These business models kept US companies profitable but lost a lot of jobs, which are hard to recover, to other countries.

So as long the US economy is adding less than 240,000 jobs a month, its recovery will stay questionable.