Poof go the profits
OK, I have to admit it, folks. I was absolutely, 100% wrong about the prospects of NEW. This is another lesson about diversification. Every once in a while, your best theory will go belly up.
My opinion about the housing market has not changed. I still claim there is nothing safer than giving a mortgage loan to a homeless beggar on the street as long as you can repossess the house in case of default. Of course, you have to be willing to dirty your hands by taking the trouble to repossess and resell the house. If your best idea of what to do with a defaulted loan is to sell it to a crony company for 5 cents per dollar, then of course you have successfully turned what should have been an asset into a liability.
House prices will continue to grow as they always do, but NEW somehow manages to stumble even on a level ground.