Car Sales Soar, Construction Spending Roars, Stocks Rock Higher

Construction spending rose to the highest level since 2007. Auto sales were up 20%+, across the board. The economy appears to be doing just fine.

U.S. construction spending surged in January to the highest level since 2007, in the latest indication that the economy was regaining momentum after slowing in the fourth quarter.

Construction spending increased 1.5 percent to $1.14 trillion, the highest level since October 2007, as both private and public outlays rose, the Commerce Department said on Tuesday. That followed an upwardly revised 0.6 percent increase in December, previously reported as a 0.1 percent gain.

Economists polled by Reuters had forecast construction spending rising 0.4 percent in January. Construction outlays were up 10.4 percent from a year ago.

As such, the Nasdaq and all of the broader indices are moving higher, quite aggressively.

Everything but VRX and TWTR, of course.

I have to admit that I am surprised by this effort. For bulls, this isn’t exactly ideal, to have such strong economic data ahead of the March Fed meeting. It’s quite possible the Fed will move to hike rates, stymie the markets vertical move and ravage your portfolios, wholesale, all for the sake of normalization.

Nevertheless, it is a good rally, born from the right stuff. If it weren’t for the Fed, I’d be a lot more optimistic about the markets chances for a sustained rally. Even so, it appears that my outlook of rallying through April might begin to gain traction.

As for me, I am 75% cash, 25% TLT, waiting for an oversold market to take advantage of. This is a new beginning and methodology for me, one that has, thus far, provided me with peace of mind that cannot be replaced by moronic trading that was likely to give me a heart attack.