George Chamberlin's Money in the Morning

August 29, 2014

Say goodbye -- and thank you -- to August. Today will be the last day of trading for a month that has treated investors very nicely, thank you. All of the major indexes are up 3 percent or more and have rallied despite repeated warnings that the end is near. The top headline at MoneyNews.com this morning says: "U.S. stocks might drop 30 percent in next 5 years." Then again, they might not. Year to date, the Nasdaq is up a respectable 9.1 percent, the S&P 500 has gained 8.0 percent and the Dow industrials are lagging with a gain of 3.0 percent. These numbers are very impressive considering the huge gains posted in 2012 and 2013. It reminds me of the comments of S&P's Sam Stovall: "Great years are followed by good years."

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Say goodbye -- and thank you -- to August. Today will be the last day of trading for a month that has treated investors very nicely, thank you. All of the major indexes are up 3 percent or more and have rallied despite repeated warnings that the end is near.

August is going out like a lion on Wall Street. Well, like a "Lion King." Nteliseng Nkhela, the actor who portrays Rafiki in the Broadway version of the Disney musical, was on hand this morning to ring the opening bell at the NYSE to celebrate the 7,000th performance of the show in New York.

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The Department of Commerce reported this morning that personal incomes rose by 0.2 percent in July while spending was down 0.1 percent. In other words, we were making it faster than we were spending it. The news was immediately interrupted to suggest consumers were exhausted and once again poised on the brink of financial calamity. In fact, the slowdown in spending was the result of a dip in auto sales, which had been crazy strong through the first half of 2014. The report also showed the inflation rate over the past 12 months held steady at 1.6 percent, a number Janet Yellen and others at the Fed say is very, very low and, accordingly, will prevent any increase in short-term interest rates for quite a while.

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Speaking of Yellen, documents filed with the U.S. Office of Government Ethics show the chairwoman of the Fed and her husband own at least $5.3 million in assets including a stock portfolio with shares of Home Depot and Raytheon, as well as a stamp collection worth more than $15,000.

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Shares of Apple are trading at a new post-split high today as the company gears up for a big event on Sept. 9. Invitations for the event say the meeting will be held at the Flint Center for the Performing Arts in Cupertino, the same venue where Steve Jobs introduced the first Mac computer 30 years ago. The message in the invitation does not identify the purpose for the gathering, only saying, "Wish we could say more." Betting money says Apple will introduce its first iWatch, a bigger screen iPad, and perhaps something else new and exciting.

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Add Kia Motors to the long list of car companies building vehicles in Mexico. The company said it will spend $1 billion to build a new facility in northern Mexico. The plant could be on line by early 2016 and will have the ability to put together as many as 300,000 small cars a year for sales in the U.S. and Mexico. Kia joins other manufacturers including Nissan, VW, General Motors, Ford and Chrysler who already have facilities south of the border.

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What a shame the Chargers-Cardinals game was not shown live last night. We all missed seeing a real nail biter as the Bolts out-field-goaled the Cards 4 to 3, making the final score 12-9. Sounds more like a soccer game. I watched the first half of the Raiders-Seahawks game and those guys were throwing touchdown passes all over the place. Thank goodness the Pads are back in town so we can see some real offensive production.

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