...will make a profit and I will show a substantial loss this year. My spec, built last year has never had a showing. Never had a call. Granted, Michigan is bad but beware the housing disease is spreading and fast. Across the country bubbles are bursting. I hate to be so negative but this enviroment could be disasterous for all in the construction business, in fact, the entire economy could be propelled into recession. I suspect PHM will soon be hurting alot worse than now and about as bad as me very soon. Sadly Yours; Jeer
Pulte's inventory has increased almost $2 Billion Dollars in the last six months. To help fund this it appears that about $500 million dollars of mortgage loans were sold and about $600 million of unsecured short term borrowing was obtained. The question is whether the $10.676 Billion of inventory and almost $400 million of land and $375 milliion of goodwill is really worth what is represented. Only time will tell. But in the interim, it is clear that the cost to carry the unsold inventory will cut into profits in the future. The question is a what price will that inventory have to be liquidated in the future?