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No more bubbles to bail out the housing bubble
MSN money ^ | 12/18/06 | Bill Fleckenstein

Posted on 12/19/2006 7:14:11 AM PST by finnman69

Wall Street has a soft spot for the "soft landing" thesis, but to me it's crystal clear that a serious economic slowdown is under way. What has been surprising: not that the economy is weakening but that so many people seem to expect a soft landing, and therefore remain in denial about the seriousness of the slowdown.

I guess the predilection toward a soft landing is a function of the following: So many folks in the investment business -- and in the country at large-- haven't experienced a consumer-led recession in so long that they think this outcome is just not possible. That's because the Federal Reserve Board has evolved into being a business-cycle suppressor and bubble manager. Consequently, folks just assume that economic weakness is a feature of the business cycles of yesteryear.

(Excerpt) Read more at articles.moneycentral.msn.com ...


TOPICS: Business/Economy
KEYWORDS: bubble; fannie; fanniemae; fleckenstein; fnm; housing; housingbubble; realestate; schadenfreude; softlending
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The bubbles are mainly coastal, ground zero being Boston, NYC/NJ area, DC/VA, almost all of Florida minus the NE, Phoenix, Las Vegas, and California

See these new maps of the 100 biggest US housing markets

http://money.cnn.com/popups/2006/fortune/invguide_realestate/index.html

1 posted on 12/19/2006 7:14:13 AM PST by finnman69
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To: finnman69
Various areas in the stock market are more vulnerable than others, though in some ways, it's all one trade. Consequently, I think the chance for at least double-digit negative returns next year is very high.

There's my cue to buy.

2 posted on 12/19/2006 7:20:24 AM PST by Minn
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To: GodGunsGuts
The consumer slowdown is on the way.

Now, however, it's quite clear that the consumer is being affected -- whether one looks at the sales data from Wal-Mart and other retailers, or at the Liscio Report's data on state sales-tax receipts. To quote from Liscio's latest survey: "The weakening consumption trend is now established, and the majority of our tax contacts expressed real concern about a slowing in sales-tax collections. It now appears clear that consumers are not spending the billions of dollars they have saved on gas in recent months." Furthermore, when I e-mailed Liscio to share my view that we are entering a recession, here's the response I received: "We note with a shudder that our indexes look a lot the way they did in fall of 2000, especially the weakening and then big drop in the sales tax survey. The SDI led us into the last recession, and the states that led are very weak right now, as well."

3 posted on 12/19/2006 7:21:23 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: finnman69
What has been surprising: not that the economy is weakening but that so many people seem to expect a soft landing, and therefore remain in denial about the seriousness of the slowdown.

Tell me ALL about it. I could write for a solid hour about the denial I see in school children who think they can avoid homework, not study, remain ignorant and STILL demand the same pay and benefits that an educated person is going to earn. Pay day has to come or all of God's laws, economic laws, etc. will have been broken.

4 posted on 12/19/2006 7:21:37 AM PST by MeneMeneTekelUpharsin (Freedom is the freedom to discipline yourself so others don't have to do it for you.)
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To: MeneMeneTekelUpharsin

housing permits down...PPI up too...

My thoughts we are on the first tier of the housing crash..two more tiers to go...


5 posted on 12/19/2006 7:24:50 AM PST by Youngman442002
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To: MeneMeneTekelUpharsin
Get back to me when we actually have these double-digit loses the bubble heads have been telling us about. Right now we have seen about a 3.5% fall and it appears to be the bottom, which is the soft landing we have expected.

Why do bubble heads always proclaim themselves correct when they have missed out of the biggest housing boom in history and we still haven't seen anything remotely close to the crash they have been predicting. The only people in denial are the bubble heads.

6 posted on 12/19/2006 7:27:45 AM PST by Always Right
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To: Minn

Amen to that, brother!


7 posted on 12/19/2006 7:29:00 AM PST by Hoosier-Daddy (It's a fight to the death with Democrats.)
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To: finnman69

8 posted on 12/19/2006 7:29:10 AM PST by Vaquero ("An armed society is a polite society" Robert A. Heinlein)
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To: Always Right
http://immobilienblasen.blogspot.com/2006/12/hosuing-start-down-255-yoy-permits-down.html

U.S. building permits down 31.3% year-over-year
U.S. housing starts down 25.5% year-over-year
U.S. Nov. building permits fall to 9-year low.
U.S. Nov. building permits short of 1.55 mln expected
U.S. Nov. housing starts exceed 1.54 mln expected.
U.S. Nov. building permits fall 3% to 1.506 mln pace.
U.S. Nov. housing starts up 6.7% to 1.588 mln pace

Building permits are down 31.3% in the past year and are down 14.1% in the first 11 months of 2006 compared with the same period in 2005.

Regionally, starts rose 8.6% in the Northeast and rose 18.5% in the South. Starts fell 6.3% in the Midwest to the lowest level in 15 years. Starts fell 8.1% in the West to the lowest level in five years.

http://calculatedrisk.blogspot.com/2006/12/housing-starts-and-completions.html


Click on graph for larger image. The first graph shows Starts vs. Completions. Starts have fallen "off a cliff", but completions have just started to fall.


This graph shows starts, completions and residential construction employment. (starts are shifted 6 months into the future). Completions and residential construction employment are highly correlated, and Completions lag Starts by about 6 months. Based on historical correlations, it is reasonable to expect Completions and residential construction employment to follow Starts "off the cliff". This would indicate the loss of 400K to 600K residential construction employment jobs over the next 6 months.

9 posted on 12/19/2006 7:34:19 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: finnman69

Doomed. Doomed I say.


10 posted on 12/19/2006 7:37:31 AM PST by pissant
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To: finnman69

Depends. I live in one of the five fastest growing towns in MA. There is no slow-down here in housing with over 1,000 building permits pulled last year.


11 posted on 12/19/2006 7:39:53 AM PST by pabianice
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To: MeneMeneTekelUpharsin
Tell me ALL about it. I could write for a solid hour about the denial I see in school children who think they can avoid homework, not study, remain ignorant and STILL demand the same pay and benefits that an educated person is going to earn.

I have several college-aged employees here in town and several in Argentina. I've found that the ones in Argentina, who speak English as a second language, are significantly more literate in English (and better spellers) than their counterparts here in the US.

I have no doubt that the US employees are very intelligent - however it's also very apparent that our educatational system has failed them miserably. As the person who makes compensation decisions, I can assure you that it's going to cost them dearly in terms of cold, hard cash.

12 posted on 12/19/2006 7:40:43 AM PST by The Duke (I have met the enemy, and he is named 'Apathy'!)
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To: finnman69

" The bubbles are mainly coastal, "

Beware of the "isolated bubbles" fallacy -- it's the equivalent of saying something like, "Those leaks in the dam are over there; it looks just fine where I am."

When the dam bursts, the whole valley gets washed away....


13 posted on 12/19/2006 7:41:29 AM PST by Uncle Ike ("Tripping over the lines connecting all of the dots"... [FReeper Pinz-n-needlez])
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To: pabianice

How many were pulled the prior year?


14 posted on 12/19/2006 7:47:04 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: The Duke

"our educatational system"

Is that like Strategery?


15 posted on 12/19/2006 7:47:53 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: finnman69

Of course building has slowed down. What is the point? We were building at record pace, and have dropped down to more substainable levels close to the historical average. The price for newly built homes has actually gone up in the last year.


16 posted on 12/19/2006 7:48:33 AM PST by Always Right
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To: Vaquero

17 posted on 12/19/2006 7:48:40 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: finnman69
but to me it's crystal clear that a serious economic slowdown is under way

Based on what? The author is either an idiot or a Democrat.

18 posted on 12/19/2006 7:49:49 AM PST by montag813
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To: ex-Texan; Petronski; Toddsterpatriot; Hydroshock; GodGunsGuts

Hey extexan, remember calling me a jerk & a liar for saying housing values in my area have not dropped? This map says exactly what i have claimed for my area, that house prices are not dropping.

Are you ready to apologize yet for calling me a jerk and a liar, because the facts are, you are just wrong.


19 posted on 12/19/2006 7:51:51 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: montag813

Pelosi's fault.


20 posted on 12/19/2006 7:54:38 AM PST by FlipWilson
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To: finnman69
The bubbles are mainly coastal, ground zero being Boston, NYC/NJ area, DC/VA, almost all of Florida minus the NE, Phoenix, Las Vegas, and California

By the time it's all over, I predict the percentage losses in real estate value will be greater in the low-demand areas of the country than in the high demand areas. Meaning, the coastal bubbles will fall first, but won't ultimately unwind as far as the flyover country non-bubbles.

21 posted on 12/19/2006 7:54:51 AM PST by Mr. Jeeves ("When the government is invasive, the people are wanting." -- Tao Te Ching)
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To: Uncle Ike
""When the dam bursts, the whole valley gets washed away....""

Not everyone built in the valley.

22 posted on 12/19/2006 7:56:28 AM PST by Between the Lines (Liberalism: the insanity that results from too many people living in close proximity to one another.)
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To: Fierce Allegiance

Bump to see what kind of man ex texan is. (I think I already know)


23 posted on 12/19/2006 7:58:50 AM PST by Balding_Eagle (God has blessed Republicans with political enemies who are going senile.)
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To: All

worth a listen to,streaming audio, about 50 minutes long. One of the guys is a Bush hating/antiwar economist, but otherise, I think the economic analysis is interesting.

http://globaleconomicanalysis.blogspot.com/2006/12/contrarian-debate-janszen-vs-mish.html

There is no transcript available but following are Mish's views on the parallels between now and 1929 and why this is not a repeat of the 70's. Let's discuss the 70's first.

70’s Rerun

Similarities

War in Vietnam war then vs. the war in Iraq now
Rising oil and commodity prices
Differences

Rising Oil prices [demand side shock vs. supply side shock]
Spiraling wages then vs. declining wages now
Wage and price controls then

Consumer Debt levels – Significant ability to take on more debt in the 70's

Housing down payments – 20% then 0% now

Two family incomes now vs. one family income then

The power of unions - then

Globalization & Global wage arbitrage - now

Outsourcing - now

Productivity improvements - The internet and other innovations - now

Declining credit standards - now

Downfall of communism

Long term interest rates under 5% - now

New creative financing ideas running rampant - now

Massive use of derivatives - now
China, India, and Emerging Markets

The differences noted above are staggering and Eric agreed.

20's Rerun

Throughout the 1920s, the Fed deliberately and unwisely stimulated the stock market by keeping the “call rate,” that is, the interest rate on bank loans to the stock market, artificially low. – Margin rates were just lowered here and the FF rate which was lowered to 1% supported a big housing boom.
In the late 1920s, bank credit propelled a massive real estate boom in New York City, in Florida, and throughout the country. We now have the biggest housing bubble in history.

In the 1920’s there was a massive infusion of money (gold) from war torn Europe stimulating our economy. We currently have a massive stimulus of cheap money from Japan and China via and various carry trades and cheap credit supporting our economy.
In the 20’s we intervened in foreign exchange markets to enhance or stabilize Europe’s power to buy our exports. We currently are involved in disputes with China over currency issues attempting to get China to buy more of our goods.
There were massive productivity improvements in the 20’s along with the industrial revolution and assembly line processing. The 90’s – 2000’s productivity miracle was the internet. Huge boom periods on account of disruptive innovation. By contrast there was no such innovative disruptions in the 70’s.
In late 20’s credit was expanding at a rapid pace but there was no need for additional productive capacity. Today GDP is rapidly falling but credit is still rising. There is no pent up demand for homes, restaurants, retail stores, strip malls, autos, truck, etc, just as there was no need for additional assembly line production in 1929. Speculation replaced productive capacity just as it is today.
In 1929 leverage was extreme via stock margin. In 2006 credit derivatives leverage is extreme to the tune of 340 trillion dollars worth with no one really understand exactly what the counterparty risk is.
A few days before leaving office in March 1929, Coolidge called American prosperity “absolutely sound” and assured everyone that stocks were “cheap at current prices.” Based on the “Treasury Model” and unsustainable earnings growth due to financing activities, we are once again told time and time again that “the economy is sound” and stocks are cheap at current prices.
"Keynesian Folly", along with other massive government interventions managed to convert what would likely have been a short, sharp recession into a chronic, permanent, stagnation with an unprecedented high unemployment that only ended with World War II. Massive government interventions between 2002 and 2005 prevented a badly needed recession and instead created the biggest asset bubble in history.
In 1933 gold coins were confiscated – now we have a threat of nickels being confiscated.
At the time, the stock market of 1929 was the biggest asset bubbles in history. We have now vastly exceeded all previous credit bubbles.
The Smoot-Hawley Tariff was signed into law on June 17, 1930. There are renewed threats of tariffs in the U.S. Congress right now.


24 posted on 12/19/2006 8:02:05 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: montag813
Based on what? The author is either an idiot or a Democrat.

??? Being an idiot and being a Democrat is most definitely not mutually exclusive. The author is probably both.

25 posted on 12/19/2006 8:03:03 AM PST by Always Right
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To: Balding_Eagle
I think I already know

I'd be shocked if he actually apologized.

26 posted on 12/19/2006 8:04:10 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: finnman69
Yet - Housing stocks are up for the last 6 months - they are down from their all time highs but not as much as you would expect with all this doom and gloom talk. Money talks and BS walks...
27 posted on 12/19/2006 8:05:06 AM PST by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: finnman69
There is no transcript available but following are Mish's views on the parallels between now and 1929 and why this is not a repeat of the 70's.

OK, go ahead and open your mouth and remove all doubt.

28 posted on 12/19/2006 8:05:27 AM PST by Always Right
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To: Fierce Allegiance
I never called YOU specifically a liar, FA. And you cannot point to a single post by me saying 'Ferce Allegiance' is a liar. I was talking generally about your buddy Petronski's abuse of the rules. Pedro was banned recently for lying and attacking people outrageously :

http://www.freerepublic.com/~petronski/

29 posted on 12/19/2006 8:06:27 AM PST by ex-Texan (Matthew 7: 1 - 6)
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To: Mr. Jeeves
By the time it's all over, I predict the percentage losses in real estate value will be greater in the low-demand areas of the country than in the high demand areas.

Why? The low-demand areas have not seen the anual double-digit rise in prices, how could they fall more?

30 posted on 12/19/2006 8:09:24 AM PST by Always Right
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To: 2banana

The NAHB index is bumping along at a 15 year low.

http://today.reuters.com/news/articleinvesting.aspx?view=CN&storyID=2006-12-18T180044Z_01_NYD000046_RTRIDST_0_USA-HOMEBUILDER-INDEX-URGENT.XML&rpc=66&type=qcna

NEW YORK, Dec 18 (Reuters) - U.S. homebuilders' sentiment dipped slightly in December, although they expressed greater confidence for mid-2007, the National Association of Home Builders said on Monday.

The NAHB/Wells Fargo Housing Market index fell one point to 32 but held above the 15-year low of 30 reached in September as lower mortgage rates and cheaper new home prices buoyed buyer demand, the group said.

Economists expected the index would rise to 34, based on the median forecast in a Reuters survey. Just three of 31 economists polled forecast a drop, with Citigroup Inc. and 4Cast Ltd. economists predicting a jump to 37.

Readings below 50 mean more builders view market conditions as poor than favorable.


31 posted on 12/19/2006 8:11:30 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: 2banana

http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-12-18T232649Z_01_N18205500_RTRIDST_0_HOVNANIAN-RESULTS-UPDATE-1.XML

UPDATE 1-US homebuilder Hovnanian posts 4th-quarter loss

LOS ANGELES, Dec 18 (Reuters) - Home builder Hovnanian Enterprises Inc. (HOV.N: Quote, Profile , Research) said on Monday that $315 million in land-related charges led to a quarterly loss in a weak U.S. housing market.

For the fiscal fourth quarter ended Oct. 31, Hovnanian posted a net loss of $117.9 million, or $1.88 per share, compared with a profit of $165.4 million, or $2.53 per share a year earlier.

Revenues fell to $1.7 billion from $1.8 billion.

Hovnanian said it incurred $336 million of charges related to inventory impairments and land option write-offs in all of 2006, including $315 million in the fourth quarter.


32 posted on 12/19/2006 8:13:59 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: ex-Texan; Fierce Allegiance; Balding_Eagle
I never called YOU specifically a liar, FA. And you cannot point to a single post by me saying 'Ferce Allegiance' is a liar.

It is very hard to tell when some posters are lying. One poster claims there 'is no bargain hunting in CT.' The jerk just ignores the fact that median prices just crashed $ 24,000 throughout the state. They just stick their heads in the sand, clinch their teeth and lie.

254 posted on 12/13/2006 11:15:30 AM CST by ex-Texan (Matthew 7: 1 - 6)

Parsed like a lawyer! Good job!

33 posted on 12/19/2006 8:14:28 AM PST by Toddsterpatriot (If you agree with EPI, you're not a conservative!)
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To: Always Right

The number of houses on the market has been declining for 5 to 6 months in northern Virginia. Soon it will be below the levels it was when the housing economy slowed down. A George Mason Univ professor predicts prices are headed up in 7 percent the spring due to continuing strong demand "as far as the eye can see."


34 posted on 12/19/2006 8:14:54 AM PST by WashingtonSource
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To: ex-Texan

He'll be back to challenge your falsehoods and generally bogus doom&gloomery.

I knew you wouldn't apologize for calling me a liar and a jerk. Your skating around the fact is further proof f your character, or lack there of.


35 posted on 12/19/2006 8:15:24 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: finnman69
Take at look at the largest luxury home builder in American - Toll Brothers. As of this morning - their stock is at 31.68. 52 week high is 39.98 and 52 week low is 22.22.

Like I said - not doing great but not too bad considering all the doom and gloom talk...

36 posted on 12/19/2006 8:15:44 AM PST by 2banana (My common ground with terrorists - they want to die for islam and we want to kill them)
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To: Toddsterpatriot

That's the one. I said the words to which he refers, but he doesn't refer to me by name.

Smarmy schmuck, and the claim in his post IS a lie.

I'm not referring to anyone specifically, but we know 'he' is the jerk & liar.


37 posted on 12/19/2006 8:18:56 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: ex-Texan
I never called YOU specifically a liar, FA. And you cannot point to a single post by me saying 'Ferce Allegiance' is a liar.

Well there was this post: "It is very hard to tell when some posters are lying. One poster claims there 'is no bargain hunting in CT.' The jerk just ignores the fact that median prices just crashed $ 24,000 throughout the state. They just stick their heads in the sand, clinch their teeth and lie."

And you were talking about Fierce Allegiance, since he was the one who made the statement about bargain hunting. You are trying to split hairs by saying you did not specifically call him a liar.

38 posted on 12/19/2006 8:19:19 AM PST by Always Right
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To: Fierce Allegiance

see post #38


39 posted on 12/19/2006 8:20:10 AM PST by Always Right
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To: Always Right
Why? The low-demand areas have not seen the anual double-digit rise in prices, how could they fall more?

Because in a slump, those areas will go to zero-demand. And in the event of a US housing slump, a lot of foreign money is going to come into the market and keep prices high in popular places like Boston and San Francisco, while suburban Houston just isn't going to get any.

40 posted on 12/19/2006 8:21:30 AM PST by Mr. Jeeves ("When the government is invasive, the people are wanting." -- Tao Te Ching)
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To: 2banana

Hovnanian shares sink on losses, weak outlook
The homebuilder blames land-related charges and warns it will deliver lower-than-expected results during the next fiscal year.

December 18 2006: 7:51 PM EST

LOS ANGELES (Reuters) -- Home builder Hovnanian Enterprises Inc. said Monday that $315 million in land-related charges led to a quarterly loss, and forecast lower-than-expected results for 2007, sending its shares lower.

For the fiscal fourth quarter ended Oct. 31, Hovnanian posted a net loss of $117.9 million, or $1.88 per share, compared with a profit of $165.4 million, or $2.53 per share a year earlier.

Revenues fell to $1.7 billion from $1.8 billion.

Shares of Hovnanian (Charts), which competes against rivals such as D.R. Horton (Charts) and Pulte Homes (Charts), fell over 4 percent in after-hours trade from its close of $35.25 on the New York Stock Exchange.

Hovnanian said it incurred $336 million of charges related to inventory impairments and land option write-offs in all of 2006, including $315 million in the fourth quarter.

The company said it had not anticipated the suddenness or magnitude of the fall in pricing. The pace of new home sales was still being affected by high contract cancellation rates, increases in resale listings and in new homes available for sale, it added.

Hovnanian forecast fiscal 2007 earnings between $1.50 to $2.00 per fully diluted common share. For the first quarter, it projected earnings of between five cents to 10 cents per share, with earnings significantly weighted to the second half of the year.

Analysts on average had forecast Hovnanian to report net income of about $2.50 per share for the year and 44 cents per share for the quarter, according to Reuters Estimates.


41 posted on 12/19/2006 8:21:32 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: Always Right

Thanks.


42 posted on 12/19/2006 8:25:28 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: Mr. Jeeves
Because in a slump, those areas will go to zero-demand.

If we get to a zero demand situation in housing, there will be a lot bigger problems with the economy than just a housing bubble. Our economy is not on the verge of such a depression, and if we are you might as well live it up while you can because we are all doomed.

43 posted on 12/19/2006 8:25:54 AM PST by Always Right
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To: Fierce Allegiance

It looks like I was 4 to 5 minutes late though.


44 posted on 12/19/2006 8:26:51 AM PST by Always Right
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To: montag813
Based on what?

Inflation roars back with 2 percent wholesale price jump Dec 19 10:01 AM US/Eastern

US inflation made a surprise comeback in November with a surprising 2.0 percent rise in wholesale prices, the biggest monthly jump in 30 years, the government has reported. The Labor Department's producer price index (PPI) was far ahead of Wall Street expectations of a 0.5 percent rise and showed strong increases in a wide range of goods. The core index, which excludes volatile food and energy prices, was up 1.3 percent -- the largest increase in more than 25 years -- against expectations of a 0.2 percent rise. The surprise jump in prices challenges expectations from economists and the Federal Reserve that inflation is under control.

45 posted on 12/19/2006 8:28:05 AM PST by finnman69 (cum puella incedit minore medio corpore sub quo manifestu s globus, inflammare animos)
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To: Always Right
You are trying to split hairs by saying you did not specifically call him a liar.

He talks like a lawyer, doesn't he.

46 posted on 12/19/2006 8:30:11 AM PST by Toddsterpatriot (If you agree with EPI, you're not a conservative!)
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To: Always Right

I still appreciate it.

Seems I'm not the only one who remembered that one clearly.


47 posted on 12/19/2006 8:30:18 AM PST by Fierce Allegiance (SAY NO TO RUDY!)
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To: Always Right; Fierce Allegiance; Toddsterpatriot
Hartford Conn. is down about $ 24,000 according to this Housing Watch site. Sales prices have been going down steadily in Conn. for the past month. In fact, sales prices are down all across the map:

http://housing-watch.com/home.aspx?d=180

I invite you to visit the site every week. The news is going to be very bleak and getting bleaker troughout 2007.

That is what December 25th edition of Business Week is saying:

Housing: Curb Your Enthusiasm About A Recovery:

Home prices still have room to decline, and it may take 15 years or more to reach new inflation-adjusted highs

Excerpts:

Housing booms are short and exciting. Housing busts, on the other hand, are long and painful. So don't put much faith in those oft-heard assertions that the worst is already over. Prices are likely to fall further in many markets in 2007. * * *

Advice to homeowners: If you need to sell and you're not getting much interest, cut the price by an extreme amount. If you make halfhearted cuts, you'll remain overpriced and you'll follow the market all the way to the bottom. Advice to buyers: Bargain hard. Many sellers are still asking for too much. "As tough as our market's been, the toughest thing is to get sellers to understand that prices aren't going up 18% to 20% a year anymore," says Ned Redpath, head of Coldwell Banker Redpath & Co. Realtors in Hanover, N.H. * * *

Housing prices were pushed up in part by get-rich-quick speculation. Now real estate has lost its grip on the public's imagination. Says Richard J. DeKaser, chief economist of National City Corp. (NCC ) in Cleveland: "We're looking at several years of weak home prices. It'll return to the time when no one is talking about real estate." Oh, well. You can still take a flier on Google Inc. (GOOG ).

http://www.businessweek.com/magazine/content/06_52/b4015085.htm?chan=top+news_sprb_realestate

Take a peek at the comments posted below the article. People are saying exactly what I have been attacked for saying on FR. One expert says prices will fall 40% to 60% in D.C.

48 posted on 12/19/2006 8:33:15 AM PST by ex-Texan (Matthew 7: 1 - 6)
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To: finnman69

To bad September and October dropped 1.3 and 1.6 respectively.


49 posted on 12/19/2006 8:34:29 AM PST by Fan of Fiat
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To: ex-Texan
One expert says prices will fall 40% to 60% in D.C.

Well, if an expert said it, it must be true. LOL!

50 posted on 12/19/2006 8:35:09 AM PST by Toddsterpatriot (If you agree with EPI, you're not a conservative!)
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