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alstry (35.21)

March 2008

Recs

20

TOTAL MELTDOWN SOON???

March 30, 2008 – Comments (9)

On Friday, UBS finally marked down municipal debt.  Canada is finally accepting commercial paper defaults and mark downs.  Residential mortgage defaults have reached historic levels.  Commercial RE defaults are rising rapidly, espeically condo loans.  Consumer revolver default is also reaching new highs.  Many classes of debt in America are under stress.  Debt is over a $40 trillion dollar asset class with counterparty obligations and supported by collateral or income.  [more]

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15

Analysts Outright Lying????

March 30, 2008 – Comments (6)

FloridaBuilder in his recent post tells us land values have crashed.  Recent publicized land sales have closed at less than $0.20 cents on the dollar.  Calculated Risk tells us about an improved deal selling for $0.15 cents on the dollar.    [more]

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13

A story of "Planned" Deception????

March 28, 2008 – Comments (4)

They say in the Home Building business, if you haven't gone bankrupt at least once, you haven't been building.  [more]

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14

No More Money!!!!!!!!!

March 27, 2008 – Comments (1)

Are we shutting down due to a lack of money?  Is someone artifically propping up the stock market to conceal reality?  [more]

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14

Analysts smoking Lennar #5

March 27, 2008 – Comments (2)

LEN end this quarter with about $1.15 Billion in backlog.  Last year Q1 ending backlog was $3.45 Billion.  Backlog was down a whopping 67%.  Another way to look at it is this years backlog is less than 1/3 of what it was last year.  ONE THIRD!!!!!!!!!!!!!!!!!!!!!!!!!!!  [more]

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15

Coincidence of Conspiracy?

March 26, 2008 – Comments (1)

SPF is a public HB with the second largest exposure to JV liability.  It is been subject to material remargin payments over the last few quarters as home prices and land values have crashed.  Its assets are concentrated in some of the most difficult markets in the country namely CA, FL, AZ, and NV.  Its backlog to debt is one of the lowest at 1/6.  It has obtained 4 debt waivers and is now negotiating a 5th.    [more]

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15

S&P Misleading Investors????

March 25, 2008 – Comments (7)

SPF recently disclosed it only had $293 million of cash left.  It has over $750 million of debt repayments, interest payments, land take down requirements, and JV remargin liability.  SPF is liquidating assets rapidly and its very possible that the current market value of its assets does not equal its outstanding debt.  It is currently losing hundreds of millions of dollars and the outlook is deteriorating.  [more]

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9

Home Sales BOOMING!!!!!!

March 25, 2008 – Comments (1)

“Foreclosure auction sales more than doubled in San Mateo County in February over a year earlier, though they slowed somewhat from their blistering January pace, a new report revealed Monday.” “Some 81 homes were sold at foreclosure auctions last month countywide, up 224 percent from February 2007, according to a Web site that tracks California foreclosure sales.”  [more]

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10

Free House w/lot purchase

March 25, 2008 – Comments (2)

“They can get on the water in Punta Gorda Isles, and they are sitting there in the high $200,000s,’ said Luke Andreae of the Andreae Group for Re/Max Harbor Realty of Port Charlotte. ‘That is less than lots cost three years ago.’”  [more]

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10

Altstry Responds to Demon

March 25, 2008 – Comments (3)

DemonDoug's Comment:  [more]

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10

Can Analysts Read???

March 25, 2008 – Comments (2)

Zelman continued, "Reading between the lines, we have heard in recent months that SPF has focused on selling many of its top land parcels in markets such as California in order to generate cash and pay down debt.  [more]

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7

AP thinks Americans Idiots???

March 24, 2008 – Comments (2)

Headline:  [more]

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18

Are We Nuts?????????

March 24, 2008 – Comments (13)

WASHINGTON (MarketWatch) -- Boosted by a record decline in prices, the U.S. housing market showed signs of stability in February, with sales of existing homes rising modestly for the first time in seven months and inventories falling, the National Association of Realtors reported Monday.

“The median sales price plunged to $195,900, down 8.2% from a year earlier, the largest price decline recorded since the Realtors began tracking both single-family homes and condos in 1999. Prices of single-family homes fell 8.7% in the past year, also the most since the records began in 1968.”  [more]

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10

IVY ZELMAN Drinking MORE Kool-Aid?

March 22, 2008 – Comments (3)

Zelman's take on the SPF announcement from Bigbuilderonline.   [more]

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14

SPF going BK?

March 21, 2008 – Comments (5)

Some of you know SPF has been my HB whipping boy for about a year now.   [more]

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15

Housing Implosion

March 21, 2008 – Comments (5)

Report: Alt-A Delinquency Rate Nearing 18 Percent

Both subprime and Alt-A borrower delinquencies continued to rise during February, with Alt-A delinquencies rising from 15.94 percent in January to 17.40 percent. According to a report released Thursday by risk management and due diligence provider Clayton Holdings, Inc., subprime delinquences now represent an eye-opening 33.14 percent of loans on a UPB basis, as well.  [more]

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8

CA, FL, and AZ Blackballed?

March 20, 2008 – Comments (2)

Leery Lenders Demand More From Borrowers
Thursday March 20, 5:33 pm ET
By Alan Zibel and J.W. Elphinstone, AP Business Writers   [more]

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14

Pray for a normal recession?

March 20, 2008 – Comments (3)

After the jobless report came out this morning, CNBC economist Steve Liesman said "Pray for a normal recession."  [more]

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8

More Unwind?

March 20, 2008 – Comments (1)

Citigroup Plans to Cut More Than 5% of Securities Employees

By Joyce Moullakis  [more]

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8

Wag the Economic Shih Tzu

March 20, 2008 – Comments (2)

The unwinding has begun without many really knowing about it.  [more]

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8

Hooverville? No L.A.

March 19, 2008 – Comments (7)

You won't see this on American TV.

http://www.youtube.com/watch?v=CnnOOo6tRs8

Let's keep building more spec homes in CA.  Especially with all the layoffs coming down the pike.  Anyone know how many spec homes SPF is building in CA? 

Can anyone tell me how to paste the video directly on the blog?

Recs

10

Ax dropping in CA

March 19, 2008 – Comments (4)

Statewide teacher layoffs: It’s 20,000 Nathan Donato-Weinstein

The number of teachers in California who have been issued notices of potential layoffs has hit 20,000, the state’s education chief said Friday.  [more]

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17

BIG....Really Big

March 19, 2008 – Comments (12)

Merrill Sues XL Capital to Maintain CDO Insurance (Update2)

By Jody Shenn  [more]

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13

Who is INSOLVENT?

March 19, 2008 – Comments (2)

LONDON (MarketWatch) -- Carlyle Capital,  the bond fund affiliated with private equity firm The Carlyle Group, said Wednesday that its liquidators have found the fund's "substantial liabilities" are likely to exceed its assets and it's therefore considered insolvent.  [more]

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12

Constructing Destruction

March 18, 2008 – Comments (1)

Let's review current events:  [more]

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10

4400 points in 2 Days?

March 18, 2008 – Comments (0)

I wouldn't bet on it at this point.  But it sure as hell is as crazy as I have ever seen it.  [more]

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20

Cramer is a Genius!!!!

March 17, 2008 – Comments (5)

http://www.redlasso.com/ClipPlayer.aspx?id=ae47b67d-2523-4946-a2ad-aadc68176f67

Enough said.  Happy Saint Patrick's Day Mr. Cramer.

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11

4021 Points in 3 Days

March 17, 2008 – Comments (2)

Thursday is quadriple witching.  The spreads between treasuries and mortgages still under pressure.  The spreads between treasuries and munis feels like a wish bond about to snap.   Margin calls everywhere.......banks, brokerages, and hedgies feeling the heat.  Earnings starting to roll out........how will this baby unwind into Thurday's close?

 

Recs

13

4 Days-4000 Points?

March 16, 2008 – Comments (2)

Is it possible?  A 25% correction in the market in 4 days.  We just had a 97% correction in 2 days for one of America's oldest financial institutions.  On Monday, its CEO said it was ridiculous to think there was a liquidity issue.  If there is a problem  at Bear, who else has problems?  Bear is a well diversified financial institution.  Could there be a bunch of bears hiding in the woods?  [more]

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9

Ryland or Rye Bread?

March 16, 2008 – Comments (0)

Right now, a share over Ryland stock is over $26 per share.  A loaf of Rye Bread is about $3 dollars.    [more]

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12

How Bad Is It? "Ridiculous"

March 15, 2008 – Comments (3)

Banks At or Near Insolvency  [more]

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9

MASSIVE HomeBuilder DEFAULTS

March 15, 2008 – Comments (1)

Two massive housing developments in Las Vegas, involving several of the nation's largest home      builders, have received default notices on about $765 million in debt, according to one of the partners in the projects.   http://online.wsj.com/article/SB120553684871238089.html  [more]

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13

BAD and getting WORSE

March 15, 2008 – Comments (0)

“The United States has already slipped into a deep recession that could be the most serious since World War II, said Martin Feldstein, president of the Cambridge group that is considered the official word on economic cycles.  [more]

Recs

13

Homes Selling FAST!!!!................HBs GOING OUT OF BUSINESS

March 14, 2008 – Comments (5)

“Two newly built homes are on the market on the same street in the same development. One is a bank-owned property offered at $1 million, and the other is listed by homeowners at $1.5 million. Guess which one received 10 offers and has a sale pending?”  [more]

Recs

13

Margin Calls Everywhere

March 14, 2008 – Comments (3)

Hedge Funds have to cover.  Those that are short must buy.  Those that are long must sell.  Banks getting squeezed.  Investers locked out of their muni funds.  Money money everywhere not a drop to spare.  [more]

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11

Destroying America?

March 14, 2008 – Comments (3)

Sometimes my Titles are a little over the top, but they are simply there to make the reader think.    [more]

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10

Headline LUNACY

March 13, 2008 – Comments (3)

The following is a Bloomberg Headline about S&P calling a bottom for SubPrime Writedowns:  [more]

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11

RECORD Home Price Decline in CA-Again?

March 13, 2008 – Comments (1)

Southern California home prices continued to fall at a record pace in February, and are now at 2004 levels, a real estate information service reported today.

The median price for a Southland home last month was $408,000, down 17.6% from a year ago, according to DataQuick Information Systems. Area home prices have now fallen 19% on average from their peaks last year.  [more]

Recs

11

EVERY Homebuilder to Shut Down?

March 13, 2008 – Comments (5)

Right now in many parts of the country, homes are selling below replacement value.  In that environment, every home sold, is sold at a loss......even if you got the land for free.  [more]

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9

Housing-50% Additional Decline Ahead?

March 12, 2008 – Comments (4)

Mind the Gap: Home-Price Downside  [more]

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11

Recipie for a CRASH!!!!!

March 12, 2008 – Comments (1)

1.  Start a war and spend TRILLIONS.  [more]

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10

$200 OIL?

March 12, 2008 – Comments (2)

YESTERDAY:  [more]

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9

IVY ZELMAN Drinking Kool-Aid?

March 12, 2008 – Comments (3)

The babe of building analysts?    [more]

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11

48 Hours

March 12, 2008 – Comments (3)

I am going out on a limb on this one..........but the next 48 hours could be some of the most interesting in a while............I will not do this often but in light of my favorite CAPs player focusing on the next three months, I thought time to step up to the plate and narrow the time frame.  [more]

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10

What is RYL smoking?

March 11, 2008 – Comments (1)

In RYL's 10K it states the following:  [more]

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11

Stealth Mother of All Rotations

March 11, 2008 – Comments (2)

In the same day, you had the biggest sell off in the second largest sector in the stock market and watched it rotate into the largest sector.  At the end of the day everyone is happy even though billions and billions and billions of dollars was lost in Health Care.  [more]

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14

NEVER seen this BEFORE

March 11, 2008 – Comments (3)

Its getting a little old  hearing HB executives continue lie to shareholders and the public.  At the end of the HOV conference call this morning, Ara said he has seen this kind of environment before and once the competition goes out of business, things will return to "normal."  [more]

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8

Altsry's Pick 4 To Hit the Floor

March 11, 2008 – Comments (1)

At the track, some people bet to win.  Others bet to show.  Some like an exacta(1st and 2nd) and those that are really adventurous play the trifecta(1st, 2nd, and 3rd horses sequentially).  But me, I like the pick 4 when I want to knock it out of the park.  [more]

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9

Problems Getting Worse?

March 11, 2008 – Comments (1)

Fed injects liquidity to the banks and brokerage firms and dilutes the dollar, interest rates go UP.  Does rising interest rates help homeowners?   [more]

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11

HOV's CEO vs. SPF

March 10, 2008 – Comments (9)

Imagine how Ara Hovnanian feels about SPF?   SPF has about 1/3 the backlog as HOV($442 million vs. $1.3 Billion) and over $3 Billion of debt including JVs(approaching 50% more debt compared to HOV). Spec homes are about the same.

Last year HOV got rid of half their lots and didn't make a dent in debt. Assuming HOV gets rid of the other half of lots this year, at even lower margins(Ara admits he doesn't expect a recovery until the end of the year), this company will not have any lots to build on and over $2 Billion of debt.  OUCH!!!

Basically Ara has implied that HOV is going BK in 2008 extrapolating the above to its logical conclusion.

Thanks Ara.   [more]

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12

Homebuilders GONE by Summer?

March 10, 2008 – Comments (3)

CTX and PHM liquidating land at $0.16 cents on the dollar.  [more]

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12

SPF's Legal Conflict

March 10, 2008 – Comments (2)

SPF owes its revolver and Term A and B banks almost $500 million dollars.  [more]

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12

Homebuilder Crash....Banks Shutting Them Down Finally

March 09, 2008 – Comments (1)

DHI liquidating homes for 50% off.  When you are selling homes at that price, you are not making a dime.  There is little chance that any sane homebuilder would take an order in this environment on a money losing sale, and then risk it may cancel to boot.  There is even less chance a buyer would order a home at a profitable price when he can buy a liquidated spec at 50% off just ready for the picking from a number of builders in his area.  [more]

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13

SPF Lying, Cheating and Stealing?

March 08, 2008 – Comments (11)

Right now SPF has almost twice as many spec homes completed or under construction compared to backlog.  No other public HB comes close to % of spec homes UNDER CONTRUCTION to backlog.  [more]

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5

SPF Lying, Cheating and Stealing?

March 08, 2008 – Comments (0)

Right now SPF has almost twice as many spec homes completed or under construction compared to backlog.  No other public HB comes close to % of spec homes UNDER CONTRUCTION to backlog.  [more]

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13

America Going Broke!!!

March 08, 2008 – Comments (2)

"The median household earned $48,201 in 2006, down from $49,244 in 1999, according to the Census Bureau. It now looks as if a full decade may pass before most Americans receive a raise."  [more]

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12

March Madness CRASH?

March 07, 2008 – Comments (6)

Jobs getting slashed by the TENS of Thousands.  Oil flying through the roof.  Homes getting foreclosed by the hundreds of thousands.  Our cities running out of money.  Companies and Investment Funds liquidating billions and billions of assets.  Banks losing billions and billions.  Homebuilders losing billions.  Auto companies losing billions.  Food costs getting much more expensive.  Insurance profits sliding.  Dollar falling through the floor.  Profits evaporating everywhere.  Commercial RE vacancies keep going up.  Commercial RE prices falling down down down.  Retailers shutting stores around the country.  Retail sales falling for many retailers.  State sales taxes falling.  Personal bankruptcies jumping way up.  Loan defaults up up up.  [more]

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11

SPF misleading shareholders AGAIN?

March 07, 2008 – Comments (0)

They just filed an S-3 to raise $600 million.  Not only that they went as far to spend the cash to make it effective.  Last year they lost MORE than $600 million.  This year they are likely going to lose even more as conditions are much worse.  Do you think anyone is going to give these guys $6 dollars less anything more?    [more]

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11

BK for 75% of Public Home Builders?

March 07, 2008 – Comments (7)

Right now foreclosures are at a historical high and climbing.  [more]

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17

Housing Tsunami or simply rising water?

March 06, 2008 – Comments (6)

Americans' percentage of equity in their homes fell below 50 percent for the first time on record since 1945, the Federal Reserve said Thursday. Homeowners' portion of equity slipped to downwardly revised 49.6 percent in the second quarter of 2007, the central bank reported in its quarterly U.S. Flow of Funds Accounts, and declined further to 47.9 percent in the fourth quarter -- the third straight quarter it was under 50 percent.

That marks the first time homeowners' debt on their houses exceeds their equity since the Fed started tracking the data in 1945. The total value of equity also fell for the third straight quarter to $9.65 trillion from a downwardly revised $9.93 trillion in the third quarter.

Moody's Economy.com estimates that 8.8 million homeowners, or about 10.3 percent of homes, will have zero or negative equity by the end of the month. Even more disturbing, about 13.8 million households, or 15.9 percent, will be "upside down" if prices fall 20 percent from their peak.

The latest Standard & Poor's/Case-Shiller index showed U.S. home prices plunging 8.9 percent in the final quarter of 2007 compared with a year ago, the steepest decline in the 20-year history of the index.  [more]

Recs

14

Does SPF's mgt KNOW its going BK?

March 06, 2008 – Comments (7)

At the early part of this year, mangement gave themselves million in cash bonuses.  MILLIONS IN CASH BONUSES.  [more]

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9

Desperate Headlines?

March 06, 2008 – Comments (1)

HEADLINE:   Big jump for Wal-Mart   [more]

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8

SPF Inflating Asset Values?

March 06, 2008 – Comments (2)

SPF reports the value of homebuilding assets on its books at approximately $2 billion dollars.  Most of that value is owned land much of which is located the very challenged markets of CA and FL.  We know that owned land has recently been selling for around $0.30 on the dollar.  Land values have generally continued to decline since those reported sales.  [more]

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9

Will J.P. Morgan Squeeze SPF?

March 05, 2008 – Comments (1)

J.P Morgan is one of SPF's bankers.  SPF is currently in violation of its loan agreements.  It his until March 30th to negoatiate another waiver with its bankers for the fourth time.  It appears that bankers are getting much tigher lately.  Here is what happened to Thornburg Mortgage tonight:

The Company received a letter from JPMorgan Chase Bank, N.A. (“JPMorgan”), dated February 28, 2008, after failing to meet a margin call of approximately $28 million. The letter states that an Event of Default as defined under that certain Master Repurchase Agreement, dated as of August 3, 2006, as amended on February 7, 2007 by and between the Company and JPMorgan (the “Agreement”) exists. The letter also notified the Company that JPMorgan will exercise its rights under the Agreement. The aggregate amount of proceeds lent to the Company under the Agreement was approximately $320 million.

The Company’s receipt of the notice of an event of default has triggered cross-defaults under all of the Company’s other reverse repurchase agreements and its secured loan agreements. The Company’s obligations under those agreements are material.  [more]

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10

10% HOMELESS rate?

March 05, 2008 – Comments (4)

"Clearly we've got a crisis," said Democratic Rep. Dennis Cardoza, whose district includes much of the Valley. "You look around this auditorium and think this is America, hard-working family people who go to church on Sunday and want good schools for their kids."  [more]

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12

Is SPF worth ZERO?

March 05, 2008 – Comments (6)

At the end of last year, SPF reported to its shareholders that its bookvalue was $994 million dollars.  Now folks, is that really honest behavior from a company whose CEO and CFO are defandants in a class action suit for providing false and/or misleading guidance?  [more]

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9

Consumers dying in America?

March 05, 2008 – Comments (0)

Wages basically stagnant since 1999.  For many, wages have actually DECLINED.  [more]

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10

The CNBC Idiot Parade Continues

March 05, 2008 – Comments (2)

Some guy on CNBC representing one of the Job reporting companies indicated that this downturn is not affecting as many jobs as the previous one in 2001.  He used the example of the airline industry laying off 100K workers as evidence for his position.  [more]

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13

Everyone Becoming Subprime?

March 04, 2008 – Comments (0)

“The Pasadena, California-based parent of IndyMac Bank said the delinquency rate on prime loans rose to 6.85 percent from 3.83 percent in last year’s first quarter. It said subprime mortgage delinquencies rose to 28.18 percent from 18.55 percent a year earlier, and late payments on home equity loans rose to 16.35 percent from 5.78 percent.”  [more]

Recs

8

Get Ready for the SPF Pump

March 04, 2008 – Comments (0)

Will Wall Street try to dump a new SPF offering on the public or is it simply a hope and a prayer by SPF management deceiving themselves into thinking they can raise money?  [more]

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10

SPF's NON Insider Buying

March 04, 2008 – Comments (1)

If you go to Yahoo and look at insider behavior, it appears that insiders are buying shares at SPF.  And not only a few insiders, a whole bunch.   A couple of very respected CAPS players fell into the trap and believed that insiders were actually buying shares.  It simply is not accurate.  As a matter of fact, the insiders were given shares and their only recent behavior is selling shares of SPF.  [more]

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8

Is BestBuy SubPrime?

March 04, 2008 – Comments (0)

It just spent billions of dollars buying back its own stock heading into a recession leaving the balance sheet vulnerable.  [more]

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11

What Does SPF's Management KNOW?

March 03, 2008 – Comments (7)

They gave themselves millions in bonuses in February after losing hundreds of millions last year and currently in violation of their loan covenants.  [more]

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10

Dominos Starting to Fall?

March 03, 2008 – Comments (2)

In his interview with Becky Quick this morning, Warren Buffett said that dominos could start falling if unemployment continued to rise.  He first made the statement at the end of last year using 5% as the threshold.  Today, he said we are much closer to that point.

What could Mr. Buffett mean?

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10

Now Counties Going Broke?

March 02, 2008 – Comments (3)

Jefferson County sewer-bond credit rating cut to junk, increasing odds of bankruptcy

Jefferson County's sewer-bond credit rating was cut to junk status Friday, increasing the odds of the largest bankruptcy filing ever by a governmental body.   [more]

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13

America's Cities Going Broke?

March 01, 2008 – Comments (9)

The spreads between Municipal Bond rates and similar treasuries are the widest in US History.  [more]

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9

Which LUNATIC at RYL authorized a dividend?

March 01, 2008 – Comments (1)

RYL ended the year with less than $1 Billion of backlog and specs under construction.  Going forward, their ability to generate revenues is limited.  [more]

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