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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: jpk1 who wrote (57588)	7/12/2006 3:15:47 PM
From: Think4Yourself	Read Replies (1) \| Respond to of 306849

This has been churning in the back of my mind for awhile and I think I have another explanation for the big increase in work. Maybe Lennar discovered the fraud and decided to get even with Veemac for the money they had already lost. They get Veemac to build a lot of houses and then not pay them. They offer to pay the workmen workmen wages and not go public about the fraud. They figure Veemac isn't dumb enough to go public either. Lennar gets part of the defrauded money back by getting framing work done at cost, and Veemac is taught a harsh lesson about messing with the big boys. Unfortunately Veemac WAS dumb enough to go public. Now Lennar has some (more) serious bad publicity and they are in big trouble for their revenge. Veemac was going to go down anyways but now they are going to drag Lennar down too. Pretty smart of the Veemac management if this is in fact what happened. Also remarkably dumb of Lennar's management, but par for the course.

To: jpk1 who wrote (57588)	7/12/2006 6:56:58 PM
From: Elroy Jetson	Read Replies (1) \| Respond to of 306849

I'm sure Lennar, like other large builders, does not have a construction loan with a lender where they obtain advances on their loan for completing the framing on some homes. They're way beyond that. The last numbers I see (Nov 30, 2005) indicated Lennar had more than $1 billion in cash - with Accounts Payable and Accounts Receivable both standing at somewhat less than $1 billion. They had almost $8 billion in inventory backed by almost $4 billion in long term debt and $5 billion in shareholder equity. No Virginia, they don't have construction loans. .