George Chamberlin's Money in the Morning

April 16, 2014

The tug of war between the bulls and bears continues. The last few days have seen a high degree of volatility as the markets seesaw trying to find a clear direction. Perhaps the end of tax selling leading up to April 15 has removed some pressure from stocks as the Dow industrials have put together two consecutive winning sessions, adding 235 points. The gains have not come easy, and extending the streak to three in a row could be tough but again today would confirm some upward momentum.

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The tug of war between the bulls and bears continues. The last few days have seen a high degree of volatility as the markets seesaw trying to find a clear direction.

We are getting close to the time of the year when the old adage “Buy in October, sell in May” starts to surface. There is statistical support for the concept but it hasn't worked out very well the last five years. The rally from 6,547 in March 2009 to the current level of 16,350 hasn't been straight up, but investors who moved away from stocks during the summer months have paid a price.

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Analysts seem completely surprised by today's report showing new home construction activity rose by 2.8 percent in March to an annualized rate of 946,000 units, mostly multifamily housing. It seems pretty simple: Now that winter is winding down, builders are getting back to what they do best -- building. The only disappointing part of the survey from the Commerce Department was a 2.4 percent drop in building permits. I have a hunch housing starts and building permits this month will both be substantially higher.

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Google yesterday introduced Project Ara, a platform for allowing smartphone users to create a device to meet their own needs rather than a packaged product. Using a basic platform, users will be able to add features to their liking including a camera, blood sugar monitor and other options available either as software or an app. The new phone is expected to go on sale in early 2015. You sort of wonder why no one else came up with that idea.

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Lots of interesting news coming out of the big auto show this week in NYC. For instance, legendary car maker Aston Martin announced it is introducing an affordable version of the V8 Vantage GT in the U.S. to make the car "more accessible to sports car enthusiasts." I guess affordable is a matter of opinion. The new Aston Martin will sell here for $99,900. It is incredibly cool, quite a bit slicker than the Tesla Model S, one of the best-looking cars on the road today. The British company was founded in 1913 and, of course, is the car of choice for James Bond.

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Also today Ford will celebrate the 50-year anniversary of the Mustang. To honor the success of the car, Ford will reassemble the 2015 model on the observation deck of the Empire State Building. To get it up there they had to cut the car into pieces because the elevators could not handle a complete car. By the way, this is exactly what Ford did 50 years ago when the Mustang was first introduced. Nowhere was the Mustang ever cooler than in the 1968 Steve McQueen movie “Bullitt.” The car chase through the streets of San Francisco, well before such scenes were produced using computer generated graphics, is still incredible to watch. I've seen the movie about 100 times and it still puts me on the edge of the seat.

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