goldissima
02-24-2006, 07:10 PM
Anyone on Rubino's list may have received the link to this article... BTW, I especially like the very last chart on the original page, see for yourself and quickly ... :haha: Complete derision continues unabated. It is the debts that made me do it??!!
Guess what, even now the Fed admits it: Americans may feel much richer because of soaring home prices, but they're not. (February 24, 2006) (http://www.libertypost.org/cgi-bin/readart.cgi?ArtNum=130818)
<hr>
Housing History: Is it 1986 or 1929?
Friday, February 24, 2006,
By John Rubino
Housing stocks got a nice pop this week, as both Barron’s and the Wall Street Journal called luxury homebuilder Toll Brothers a buy. Interesting timing, this. Why would such usually-sensible papers talk up a cyclical industry at the peak of its cycle? Well, it seems that the big home builders have diversified into lots of different regions, and used their financial muscle to buy up all the good home sites. This makes them immune from a mild slump, which is what their fans expect. As the Wall Street Journal put it:
“That's why the bulls need this housing slowdown. They are expecting that the companies will be able to have some earnings growth, grab more market share, and throw off enough cash to buy back stock to shore up their share prices.”
So the idea that the homebuilders—and by extension, I guess, the mortgage lenders and big consumer banks—are a buy hinges on the severity of the housing slowdown. If it’s modest, as the past few have been, then the homebuilders, trading at, like, 6 times earnings, will push their weaker local competitors off the field and emerge even stronger and more valuable. And based on the behavior of housing starts since the 1980s, that doesn’t seem too farfetched. Starts have fluctuated, sure, but they haven’t fallen by very much for very long. A few years of modest decline is the worst recent history says to expect. The leading homebuilders would breeze through another 1992 or 2001 without a scratch..... MORE
http://www.dollarcollapse.com/iNP/view.asp?ID=22
also see: Shorting this Market, Part One
Monday, February 20, 2006,
By John Rubino
http://www.dollarcollapse.com/iNP/view.asp?ID=21
Guess what, even now the Fed admits it: Americans may feel much richer because of soaring home prices, but they're not. (February 24, 2006) (http://www.libertypost.org/cgi-bin/readart.cgi?ArtNum=130818)
<hr>
Housing History: Is it 1986 or 1929?
Friday, February 24, 2006,
By John Rubino
Housing stocks got a nice pop this week, as both Barron’s and the Wall Street Journal called luxury homebuilder Toll Brothers a buy. Interesting timing, this. Why would such usually-sensible papers talk up a cyclical industry at the peak of its cycle? Well, it seems that the big home builders have diversified into lots of different regions, and used their financial muscle to buy up all the good home sites. This makes them immune from a mild slump, which is what their fans expect. As the Wall Street Journal put it:
“That's why the bulls need this housing slowdown. They are expecting that the companies will be able to have some earnings growth, grab more market share, and throw off enough cash to buy back stock to shore up their share prices.”
So the idea that the homebuilders—and by extension, I guess, the mortgage lenders and big consumer banks—are a buy hinges on the severity of the housing slowdown. If it’s modest, as the past few have been, then the homebuilders, trading at, like, 6 times earnings, will push their weaker local competitors off the field and emerge even stronger and more valuable. And based on the behavior of housing starts since the 1980s, that doesn’t seem too farfetched. Starts have fluctuated, sure, but they haven’t fallen by very much for very long. A few years of modest decline is the worst recent history says to expect. The leading homebuilders would breeze through another 1992 or 2001 without a scratch..... MORE
http://www.dollarcollapse.com/iNP/view.asp?ID=22
also see: Shorting this Market, Part One
Monday, February 20, 2006,
By John Rubino
http://www.dollarcollapse.com/iNP/view.asp?ID=21