Toll CEO says speculators walking away from contracts

OldTrader


Registered: Sep 2002
Posts: 1087


01-15-05 04:19 PM



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Quote from ratboy88:

you didn't directly answer the question. you say there is no bubble so what is your definition...what are the parameters?

as far as time frame goes i was wrong for almost two years regarding the nasdaq and smart asses kept running their mouths....so i guess we can start the clock ticking right now...i just made my prediction so give me up to jan 2007 give or take a few months.
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I don't have a "definition" per se of the term "bubble". To me it's one of those things that I think I'll recognize when and if it occurs.

I do think that we may be at a spot where prices will do some resting, consolidating. I'm talking in general because of course real estate is regional.

Finally, I don't know about you, but I spend my day "timing" what I do. I don't make a prediction and then give myself 2 years to be right. LOL. That's weak.

OldTrader

ratboy88, "i do because it took 2 years...LOL LOL LOL"
 
ratboy88


Registered: Dec 2003
Posts: 2507


01-15-05 04:27 PM



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Quote from OldTrader:

I don't have a "definition" per se of the term "bubble". To me it's one of those things that I think I'll recognize when and if it occurs...........

OldTrader
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speaking of weak........
 
ratboy88


Registered: Dec 2003
Posts: 2507


01-15-05 04:35 PM



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Quote from OldTrader:

........Finally, I don't know about you, but I spend my day "timing" what I do. I don't make a prediction and then give myself 2 years to be right. LOL. That's weak.

OldTrader
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i spend my day "day trading" so yes, timing is very important. i don't make predictions about my trading...if i need to change my opinion on a dime, then i do it. it is not about being right or wrong..it is about what i do when i am right and what i do when i am wrong. has nothing to do with making a prediction on a chat room board. LOL LOL LOL and believe it or not i am not married to being right about the bubble..... if we experience hyper-inflation then i would change my prediction in a heart beat.
and btw, 2 years is nothing for a bubble....these things take time ya know.

but bottomline we will never know how this plays out because you are afraid to go on the record and establish what you would consider a bubble. if we hit 25% you would say that is not enough.....30% who knows. i say get off the fence oldtimer and get some balls.
 
Quote from OldTrader:

Exactly my point sonny: in fact, your prediction is one that you are singularly unqualified to make. But that's the nice thing about message boards....daytraders get to pontificate on all sorts of things that they know nothing about.

OldTrader
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OWNED pontificate that!!! LOL LOL LOL:eek:
 
Ratboy:

Thanks for posting some of those old posts. First though, I would like to point out that no where in the posts that you produced did I call you "idiot".

Now to the housing market. To add some context here, all of the posts that you produced were from January of 2005. I was not calling a peak of the housing market then. Obviously you were. And for the record, at that time if we use stocks as our proxy, KBH (Kaufman and Broad) was around $50. It was on the way to $85, 7 months later in July. In fact, in January, 2006 it was still trading around 80. In other words, one year after our conversation in January 2005, this particular stock was 60% higher. Friday, the stock had declined to $44, having basically dropped in half from the peak, but only down a modest percentage from January 2005.

Let's take the example of the Housing Stock index ($HGX). In January 2005 this index stood at 230. By July 2005 it had rallied to 295 or thereabouts. By January 2006 the index was around 270. Friday, the HGX had declined to about 211.

Now, just for the record, we could also take a look at the REIT index ($DJR). In January of 2005 we were around 215 in that index. January of 2006 it stood around 255. And as of Friday, it stood just over 300. Now, this index does not represent housing, but it does represent other types of real estate issues, gives a balanced picture so to speak.

OK, so what was widely predicted back then was that the "bubble" was bout to burst. There was nothing new in that prediction. It had been predicted for several years prior. Care to go back and check the prices of homebuilder stocks back then? LOL!

My stance at the time was that in terms of actual residential real estate, I could see a decline, maybe 20% or so depending on the area. But I was unwilling to forecast it. Why? Because at the time I saw no reason to be bearish. And as you can see from the record, prices continued on up. KBH went up another 70% over the course of the next 7 months. A year later KBH was still 60% higher.

In 2005 I was unwilling to call it a "bubble" as well. Not a term I care for. I think using the term "bubble" sets up a psychological predisposition that will preclude profiting from it. In other words, if Ratboy thinks we're in a real estate bubble in 2005, what do you think the likelihood was that he profitted from the coming 7 month, 70% move in KBH, or the better than 50% move (plus large dividends) in REITs that has transpired over the last 2 years.

Further, there was some huge money made by some in 2005 in the actual real estate. I trust Ratboy was not amongst those because he was calling for a decline!

My guess is that most of the people who were forecasting the decline lost their ass back then in 2005. At least if they acted on their "predictions" they did. I don't know many folks who can ride a stock UP 70% in a short position and stay whole.

The real shorting opportunity in my opinion was this year, in about May. A short at that time captured the bulk of the decline. I don't know if the decline is over in the stocks. Probably not. But note, I'm carefully not to "predict" because it almost always costs you more than it will make you. I'm not interested in the long side of homebuilder stocks at this time.

The actual real estate is a completely different matter. I hold a portfolio of rental real estate purchased over the years. I've done a little selling over the last couple of years. But I still hold a significant portfolio. I might add that demand for rentals in my area has jumped in recent months.

I just sold a property that I mentioned in my above post. It was a property I rehabbed and sold. Nice profit, but the profit was down from what it might have been lets say 6-12 months ago.

And perhaps that says it all. In terms of real estate itself, there is always deals around, especially now because there is some panic around, and houses aren't moving. This is a time when you make some unbelievable deals. But keep something in mind. In real estate, the profit is in the buying. Meaning you buy with the understanding that properties are under pressure, that they aren't moving unless they are priced right. So you have to buy really low in order to profit in todays market.

OldTrader
 
Quote from FightTheFuture:

Yes, apparently so. Looks like the sell off for TOL started August 2005. For a 50% drop.

I dunno S2007S, it's your money. Do you plan on just shorting TOL and or others?
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Im not long or short the homebuilders. Just like to pass on the news involving the homebuilders and real estate industry.
 
Quote from Triple X:

LOL, everyone who thinks the homebuilders have bottomed needs to look at a "max" chart of TOL on Yahoo finance. The last time housing really took a hit, the early 90's, TOL and KBH were 2 dollar stocks. Robert Toll is going to keep calling a bottom because he and his brother(?) Bruce Toll are still unloading shares as we speak. Someone has to buy it from them. :eek:
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exactly, I think im being to nice when I predict another 25% drop in the homebuilding stocks.


The homebuilders have not bottomed. Dont believe what Greenspan is saying or the others hyping up the real estate markets like they have already bottomed. THEY HAVENT.
 
Quote from Triple X:

LOL, everyone who thinks the homebuilders have bottomed needs to look at a "max" chart of TOL on Yahoo finance. The last time housing really took a hit, the early 90's, TOL and KBH were 2 dollar stocks. Robert Toll is going to keep calling a bottom because he and his brother(?) Bruce Toll are still unloading shares as we speak. Someone has to buy it from them. :eek:
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LOL maybe you need to relook at the chart and learn how it is adjusted for splits before you starts making urself look dumb. Besides that, TOL ipoed right into the housing boom and subsequent bust. It went down slowly for 3 years untill 1991 where it just spiked up and took off, along with rapid M3 growth.

Who cares whether Toll brothers are selling their stock now, they were selling it all the way up, at the top and all the way down. TIE, WLT and GOOG insiders were all selling their stock on the way up, sometimes prior to 50-100% appreciations. It means little, they are just taking money off the table.

TOL is at least 50% off its historic highs. how much more can you expect without a financial crisis (which would make your nominal shorts profits worth nothing in real terms). There is a reason that homebuilders trade as such low P/Es and way below enterprise value. The market specific risk is priced.

I don't expect them to rip nor dive, it's mostly likely range trading for them. Take a look at a 2 year chart, is it not blatantly obvious that the move already happened? Well maybe it's not obvious to those who tend to be easily impressed by Vin Diesel action movies.
 
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