Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (20163)	1/2/2005 5:54:46 PM
From: Elroy Jetson	Read Replies (2) of 116555

As you discovered, Pulte purchased Del Webb Corp for $1 billion on May 2001. reviewjournal.com Late in the building cycle, large builders like Pulte buy small regional builders in a desperate attempt to acquire land and market share at a reasonable cost. As I mentioned in the previous post, builders take large losses as prices decline - since they paid such huge sums for the land. Builders facing large losses will be very reluctant to build promised amenities like golf courses, club houses etc. Some builders facing cash flow problems, will even refuse to respond to home warranty claims. Of course some builders like KB Homes frequently don't honor home warranties even when their profits are large. .

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