Companies are creating jobs at the rate of more than 2 million per year. Automakers have booked what is arguably their biggest sales month ever. Planes are full, factory orders are backlogged and home sales remain brisk. Consumer confidence is up, and household income is growing faster than inflation. Federal and state budget deficits are falling, and corporations have earned more profits than they know what to do with.

All in all, the recent data point to a pretty strong economy -- stronger, in fact, than most economists had predicted even two months ago. After all, oil prices remain at record levels, closing the week above $62 a barrel. And, after a year-long campaign by the Federal Reserve, long-term interest rates are on the rise, up half a percentage point in the past six weeks. The U.S. trade deficit continues to grow, while the household savings rate last month fell to zero. Health care costs remain out of control.

But somehow, none of that seems to matter to American consumers, who continue to spend, and foreign investors, who continue to buy our companies and lend us money. Even corporate executives, who up to now have been reluctant to invest in new offices, new equipment, new employees and new products, have decided it's safe to open their wallets a bit. For the first time in nearly a decade, there's even talk once again of a "Goldilocks" economy -- not too hot, not too cold.

Favorable winds are also blowing in from overseas. The lagging economies of Germany and Italy are showing signs that they may be growing again, while Japan may finally be emerging from its financial troubles. An overheated Chinese economy seems to be cooling, while Central and South America are having some of their best years ever.

Hoping to cash in, politically, on all this good economic news, President Bush will meet with economic advisers in Crawford, Tex., this week, in between well-choreographed signings of energy and highway bills. And in Washington, the Fed is expected to announce yet another increase in short-term interest rates in an effort to dampen whatever inflationary pressures may be building up. With the economy now looking like it will continue to grow at a brisk annual rate of 4 percent for the rest of the year -- roughly the same rate it has been growing for the past two years -- an end to the Fed tightening is nowhere in sight.

These can be the most dangerous times for policymakers, and for investors. They are the times when it is easiest to let down your guard, let problems slide and let momentum carry things into the future. The greatest threat now may not be from the sudden shock or bursting bubble that many once expected, but from the complacency that comes when everything looks to be "just right."