Beat the Dart agrees with you. "September 8, 2008, 3:06pm ... SHORT Meritage Homes Corporation (MTH) - last $27.00. MTH engages in designing and building single-family attached and detached homes in the southern and western United States, while offering homes for a range of homebuyers, including first-time, move-up, luxury, and active adult buyers in 12 metropolitan areas in Arizona, Texas, California, Nevada, Colorado, and Florida. Subjective Probability model (SPM) within GREED & FEAR Formation suggests selling pressure after major move. Soft leader in weak marke . Fundamentals are marginal and further weaknesses do not justify stock price. Short term move to $24 likely."
I agree that this is overbought, but unemployment is a lagging indicator while homebuilders are a leading indicator. The last of the really bad 3 year arms are about to adjust. By next spring all of the worthless paper will be flushed.