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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Vosilla who wrote (29101)	3/22/2005 1:37:23 PM
From: Ramsey Su	Read Replies (2) \| Respond to of 110194

John, there are a lot of differences this time around. Land that builders control today are about half owned and half optioned (rough estimate on my part based on a sample of the big builders). So they may lose their option if real estate turns sour, and then holding on to the land they own till the next cycle comes around. Financing for the land are pretty solid, most of the builders have the ability to hang in there for a long while. Inventory is only a problem for large condo projects that once started, there is no way of stopping. Downtown San Diego got a bunch of those. However, I cannot find any builders who are overly exposed. When the bubble bursts, most of the big builders have the resources to garble the smaller builders, and private spec builders, who may neither have the money nor the margin to stay in the game. Do not misunderstand what I am saying. I am not bullish. I am simply wondering out loud if these homebuilders are good short candidates. Anytime I short, I prefer sectors with huge potential payoffs. Ideally, I like them to go BK. <ggggg> Legacy airlines. GM. FNM. MIs ..... Aren't they all better candiates than the homebuilders?