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Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: Siddhartha Gautama who wrote (57120)	12/10/2004 5:06:09 PM
From: Snowshoe	Respond to of 74559

Here's what "Rev Shark" said today at TheStreet.com... Homebuilders Not an Easy Short 12/10/04 2:45 PM ET The hottest sector on my screens today is homebuilders, many of which are hitting all-time highs. That isn't anything terribly unusual, but it is highly ironic. The homebuilding sector has probably been by far the most discussed short-side trade over the past year or so. The bears have been trying to catch the breakdown in the group forever and have managed only some very minor paydays. This is a particularly good example of a crowded short, and what makes it even tougher is that most of these stocks have solid balance sheets and very low P/Es. However, so many bears are drawn to the possibility of another "bubble" like we had in the Nasdaq, that they fail to really appreciate how real estate and homebuilding are very different from other types of asset bubbles. Shorting is tough enough as it is, but when the target has broad appeal among hedge funds like the homebuilders have had, it is likely to be even tougher. One of these days the trade will work but probably not until everyone has moved on to something else. The indices continue to play ping-pong in a tight range. We are bouncing back and forth between the highs and lows, and neither side can manage to exert itself. Will the bulls give it a try in the closing hour or will folks be looking to cut exposure in front of the weekend? My money is on the bulls, but not a lot of it.