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

To: Moominoid who wrote (68208)	8/28/2005 11:12:56 AM
From: shades	Read Replies (1) \| Respond to of 74559

The big profits in the SP500 at the moment are in finance and oil/resources. More than half the total I think. Well Bogle is probably wrong then saying to hold the entire market then huh - if so much of it is comprised of just a few sectors - you gonna get burned eh? As far as I can tell WLS only makes money if house prices rise. The net margin is less than the annual rate of house price increase. Profits all get plowed back into more land and construction in progress. Probably a similar story at the other homebuilders. I'm just beginning to look at this, so maybe I am wrong. Well I think the consensus almost all over SI is things are going to get bad for homies - time to short - I have problem the other way, I have sold west palm beach house and have to plow the money into 1031 investment somewhere - but everything I can go into look so overpriced. If a real estate firm buys land it's an investment and for most firms interest is an expense. But not for these firms - it all adds to "inventory". My accounting prof was telling me about a friend of his that got rich a ways back, some railroad company was going out of business - bankrupt - stock collapsed to nothing - but lookie here, they own lots of land and the purchase price is what was being shown in the books - land was worth billions - so when this was revealed - BOOM - stock skyrocket - HAHA! Remember MCdonalds recently - they just had a pop i heard because everyone thought they buying into all that good REAL ESTATE mcdonalds have - HAHA. See what I mean MOO - all those old tricks - the market wise to lots of that stuff now - hard to get the edge anymore.