Tag Archives: homebuilders

Hommies Hammered

Well actually, one Hommie is getting hammered and the index is getting dinged.  We have been following this chart of the Homebuilders Index for probably a year or so now.  It has been moving along in a large, bullish Cup & Handle.

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Today KB Home grossed out the market (thanks for the heads up, Hammer) with talk about stuff that you would not expect to see in a low energy and (some) materials and low interest rate environment.

“We are projecting our first quarter 2015 gross margin will drop significantly from the first quarter of 2014 hitting the low point for the year before improving sequentially for the remaining three quarters of 2014,” Chief Executive Jeffrey Mezger said on a conference call after the company released quarterly financial results. He said there was a “softening in demand” in some markets during the fourth quarter, more sales incentives, and pressures from construction, labor and material costs.

Unbelievable.  It reminds me of what I posted a few weeks ago about my trash man boosting prices due to increased costs – of nearly everything other than powering his trucks.  There have been other surprising instances of late as well that I don’t quite recall at the moment.

Could the payback for the balls out inflationary operation in play 24/7 and 365 over the last 6 years be brewing?

Around the Web

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Which Way Long Term Yields?

The ‘taper’ chatter is under wraps for the moment with the 10 year yield dropping the last few days and economic data dribbling in less than stellar.  Have you heard that US consumer confidence is falling?  How about that US home price growth is slowing?

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Continue reading Which Way Long Term Yields?

What’s Next for Stock Market Leadership?

So far, Kabuki Dance #3 has not produced the same effect as #’s 1 and 2 for the leading BKX-SPX ratio.  ‘The same effect’ would be great media hysteria and negative market action followed by a decision by authorities that was in the bag the whole time and a miraculous and predictable market rebound.

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Continue reading What’s Next for Stock Market Leadership?

SLV & ITB, Calls & Puts

In a small and separate trading account I have calls on the top thing and puts on the bottom thing.  The account is small and separate so I do not have to look at it too much and out think myself.

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SLV & ITB, weekly

Silver needs to hold support and the Homies need to lose it.  We’ll see how it goes.

Morning Reading

Ready for Year-End Fiscal Cliff Drama?  Doug Noland  12.3.12
Much Ado About Noise  Adrian Ash  12.3.12
How to Build a Time Machine  John Hussman, Ph.D.  12.3.12
Storm Front Approaching the Homebuilders  Acting Man  12.3.12
Recent Asset Class Performance  B.I.G.  12.3.12

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