(TW-.L) Taylor Wimpey PLC Buy/Sell

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Author	MrJockey View Profile \| Add to favourites \| Ignore
Date posted	2009-11-07 15:59
Subject	Re: mr jockey View parent message
Votes for this Posting	Voted 1 time. Not voted down.
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>>>here and in america there is a housing shortfall someone has to provide it . There is no shortfall in America. They have massive inventories, combined with 'shadow inventories' (houses foreclosed, in auction). They built 15 years worth of homes in 5 years. They are giving away $8,000 to people to buy their first home, and still prices are not rising. Foreclosures are due to peak in 2011. >>> ie private equity have asset stripped companies like this You miss the point that they also take on their debts. If a company has £1 billion of assets and say £1 billion of liabilities, then 'stripping' their assets i.e. selling them for cash will leave £1 billion of cash vs £1 billion of liabilities. If they pay off debt with the cash - you have a smaller company. Until the cost / selling price differential is significant enough to make a good margin, I can't see anything other than perhaps a short term rally based on speculation rather than fundamentals.
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