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Posted
Sep 11 2009, 04:12 PM
by
InvestorPlace
Rating:
Money Blog: Top Stocks Blog - MSN Money
This article was written by InvestorPlace's Jim Woods.
Cash for Clunkers; you've got to admit it's a catchy phrase replete with alliterative genius. The creativity here is especially surprising, given that the name was likely concocted by a government bureaucrat. I guess it's not surprising that any government program with the word "cash" in it is going to draw some attention. I mean, who doesn't want to get some cash back from the government?
So, in honor of this paragon of government generosity, I propose that we extend the "Cash for" program to a few other sectors of the economy. I mean, why should the auto industry be the only one to benefit?
Bing: Latest on "Cash for Appliances" program
After all, if giving cash away for broken-down cars works, why not apply that same logic elsewhere? So, without further ado, let's take a look at a few sectors that could use a little government stimulus.
WARNING: Readers lacking a sense of satire may want to proceed with caution.
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Posted
May 28 2009, 09:05 PM
by
Charley Blaine
Rating:
Money Blog: Top Stocks Blog - MSN Money
With Thursday’s rally, the Dow Jones industrials, S&P 500 and the Nasdaq Composite Index are poised to finish higher in May, the third monthly gains in a row for each index. The last time that happened was August, September and October 2007 -- when the market peaked.
It would require a loss of some 237 Dow points to turn May into a loser. It’s possible, but I suspect it won’t happen because the wild volatility of last fall seems to have worked itself out.
Nonetheless, the rally since March looks like it’s running out of gas
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Posted
May 21 2009, 03:44 PM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
Imagine you own a home.
Chances are, at some point in the past 3 years, you’ve heard that nagging voice in the back of your head - the one that whispered, “sell, sell, sell.” You watched as prices tumbled and buyers evaporated like morning dew.
But then you opened the paper, and there, in plain black ink, you saw that virtually everyone in both mainstream and financial media called this the worst time to sell a house in over 80 years.
What’s a seller to do?
The days of holding are past. The time to sell is upon us.
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Posted
Jan 20 2009, 09:12 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
Foreclosure: It’s not just for those "subprime" people anymore.
Besieged by collapsing home prices and frightened banks scrounging for cash, even the real-estate industry’s brightest stars are finding there’s no place to hide. According to the New York Times, small and mid-size homebuilders who thrived during the housing boom are seeing credit lines pulled even before they miss a payment.
Banks like JPMorgan (JPM) and GMAC, the financing arm of General Motors (GM), loaned builders hundreds of billions of dollars -- even as the housing market began to falter -- to buy up vacant land. Now that demand for new homes has plunged (and buyers in some areas can pick up previously constructed homes for less than it costs to build a new one), builders’ ability to turn a profit has been effectively eliminated.
It's estimated that over 20% of the nation's homebuilders have closed their doors, even as big builders like D.R. Horton (DHI), Lennar (LEN) and Toll Brothers (TOL)
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Posted
Nov 20 2008, 08:23 AM
by
Minyanville
Rating:
Money Blog: Top Stocks Blog - MSN Money
For as bad as things are in the housing market, it’s remarkable that none of the country’s big homebuilders have gone bust. The industry’s resilience is a testament to how much money the firms raked in during the boom.
Just ask guys in charge.
The Wall Street Journal reports many homebuilder CEOs socked away such obscene amounts of cash over the past 5 years that they out-earned their Wall Street counterparts. As profits soared, Toll Brothers CEO Robert Toll and his brother Bruce together took home $773 million, while Dwight Schar, chairman of Virginia-based NVR earned more than $625 million from stock sales.
By contrast, vilified Countrywide CEO Angelo Mozilo earned a mere $471 million during the same period.
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Posted
Nov 12 2008, 11:49 AM
by
Kim Peterson
Rating:
Money Blog: Top Stocks Blog - MSN Money
 People don't want to buy new homes these days, and that's wreaking havoc on the finances of homebuilders like Toll Brothers. The company saw its sales plunge 41% in its most recent quarter. Demand and traffic from prospective buyers is at a record low.
And who can blame them? People aren't going to buy cars, much less a pricey new pad, when they're unsure if they'll even have a job in the new year. So buyers are laying low, and Toll Brothers is asking the government to step in and help. Toll wants people to buy new homes, and proposes the government make that happen by cutting mortgage rates and offering tax incentives. Doing so could cost the government nearly $300 billion. Does that count as a bailout? Yes. "The government's attention should be focused on shoring up the housing
market, which is the root of the current financial crisis," said chief executive Robert Toll.
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Posted
Feb 27 2008, 03:14 PM
by
Matt Koppenheffer
Rating:
Money Blog: Top Stocks Blog - MSN Money
There are a lot of opinions running around out there as far as the economy and financial markets go. Many seem to believe that we're in the midst of a painful slowdown that could last a while, while some think that we could have another Great Depression in store and yet others say we're in a transitory down cycle.
If there's one thing for sure, it's that the market for housing has been downright terrible. New home sales are plummeting, existing home sales are hurting, and home prices are dropping like never before. This brutal market has been left homebuilding companies with terrible results and plunging stock prices.
High-end builder Toll Brothers is one of the most recent builders to report, and the picture was bleak for this typically-resilient builder. Interestingly, Bob Toll, the company's CEO, said that he believes psychology and the media coverage of housing and broader economic weakness have played a big part in perpetuating the downturn:
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Posted
Jan 22 2008, 11:54 AM
by
Robert Walberg
Rating:
Money Blog: Top Stocks Blog - MSN Money
This may seem crazy, especially with the global financial markets in the midst of the worst turmoil we've seen in nearly a decade, but the Fed's decision to slash the funds rate by another 75 basis points sent the first strong buy signal in the depressed housing sector in over a year.
One stock that stands out among the battered and beaten up homebuilders is Toll Brothers. The stock rallied nearly 5% on Tuesday on volume of 6.4 million shares -- nearly four times the daily average volume.
Truth be told, the Fed's decision to cut short-term interest rates isn't going to have a big or immediate impact on mortgage rates. Mortgage rates are tied to the long-end of the yield curve, and long-term rates are apt to remain stubbornly high due to the current anxiety in the financial markets. Nevertheless, the Fed's action is important for two reasons. First, it told the market that the Fed will do whatever it takes -- read more rate cuts -- to reduce the economic impact of the housing downturn. Second, and this is tied to the first, the rate cut changes market psychology. Instead of fearing a prolonged downturn, investors will start to look to the time when conditions improve and housing starts to firm.
Investors shouldn't underestimate the impact of the change in psychology, especially when a) builder sentiment is very near all-time lows and b) short-sellers have been betting aggressively against the sector -- and the stock. Nearly 16% of Toll's float is currently being sold short. If bears sense a change in the market's mood regarding the industry they will be forced to cover those short positions, creating a nice wave of buying. With virtually no sellers left -- face it who's still long the sector -- the path of least resistance is to the upside. As for builder sentiment, it too has only one way to go from here -- and that's up.
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