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Bulls & Bears
This past week's Bulls & Bears: Gary B. Smith, Exemplar Capital managing partner; Pat Dorsey, Morningstar.com director of stock research; Scott Bleier, HybridInvestors.com president; Eric Bolling, independent trader; Patricia Powell, Powell Financial Group president; Cheryl Casone, FOX Business Network, and MeMe Roth, National Action Against Obesity.
Trading Pit: Happy Holidays For The Housing Market?
Gary B. Smith: I think we have hit a bottom in housing, at least in terms of the housing stocks. The stocks - like Toll Brothers (TOL) and Beazer (BZH) – have been down 60 percent - 90 percent since their peaks. We haven't seen this kind of sell-off in housing stocks since the late 1980's/early 1990's, after which they all took off. We've seen median home prices level off, and I think we will see them start to come back up.
Tobin Smith: The issue isn't the housing stocks but the massive amount of actual housing inventory we have in the United States. I don't think we will see a full recovery until 2010, when this excess inventory is cleared out.
Patricia Powell: It didn't take us a year to get here (the housing boom) and it will not take us a year to get out of this (the housing slowdown). It all comes down to buyers' confidence and lenders' confidence – and the days of cheap, easy, "brain dead" lending are over.
Cheryl Casone: I think we are hitting a bottom for housing, and that has to do with the psychology you are seeing out there. When you see most of the headlines talking about the "negativity" in the housing market that is a sign that we are at a bottom. And I think in two years we will actually have a shortage in new homes.
Pat Dorsey: Inventory is the issue and it is going to take us a long time to work off the excess inventory. I also think the home builders (stocks) will be down for at least another year – remember – these stocks made huge moves with falling interest rates – we won't see that again.
Scott Bleier: Banks aren't lending (as much as they were), Fannie Mae is crashing, home builders are going out of business, the housing market seems "frozen" and there is real fear in the air. As a stock market person, that to me seems like a bottom forming. But the housing market is much different than the stock market: it takes a long time to top and a long time to bottom.
Cut Off Government Health Care for the Obese?
A British man whop recently moved to New Zealand was told his wife could not enter the country… because she was too fat and placed too heavy a burden on their national health care system.
Should America learn from this plan and cut-off government health care for the obese?
Meme Roth: First off – we can't get too emotional over the weight issue. Second – realize that the woman in New Zealand wasn't totally denied entry – she was just delayed entry. So if she is willing to take some steps to lead a healthier life, she will get in. And New Zealand has a national health care plan that says if we are going to take care of you, then you in turn need to take care of yourself.
Gary B. Smith: Medicare or Medicaid are set up to give people health care, not to deny them health care because of a certain lifestyle. I agree that obesity is a national epidemic – but so be it!
Patricia Powell: Who is going to make the decision about who is fit to receive national health care: the "skinny minnies" in Congress? The last time I checked, eating was a legal activity.
Pat Dorsey: Unfortunately – our government's farm policy contributes to the obesity problem: they make calories through processed food cheaper than calories through fresh food. So until the government stops subsidizing foods that are high in calories, then the government really can't get too upset over the obesity issue.
The best holiday present you can buy for yourself? How about a stock that will give the best gift of all: cash!