So-called experts blow it again

The so-called experts are at it again. For about 18 months now they have been telling us housing ain't so bad. It's only the doomers and gloomers club (proud member myself since 2006) that is making much ado about nothing. Subprime was contained, housing was going to bottom in mid-2007 and the 50% annual appreciation in Las Vegas and Phoenix would continue.

Except economics got in the way of that nice little fantasy.

The so-called experts were expecting KB Homes to lose $1.08 a share this past quarter. Turns out KB Homes lost $9.99 a share (couldn't they have rounded off to a nice even $10?). Someone tell me again why anyone listens to these so-called experts again. I mean OK you predict $1.08, the number comes in at $1.15, close enough. Number is $2.25, oops better luck next time,your forgot to carry the 1. But holy crap, the number is 10 times worse than you predict? I think it's time for a new line of work amigos. Imagine this kind of failure in any other profession. Oh shit, the bridge collapsed? Hmm I guess the engineer only designed it to hold 100 cars at a time, not 1000.

NEW YORK (CNNMoney.com)
January 8 2008: 8:40 AM EST

KB Home (KBH, Fortune 500), the nation's No. 5 builder by revenue, said it lost $772.6 million, or $9.99 a share, in the fourth quarter. Last year, the company posted a loss from continuing operations of $79.9 million, or 64 cents a share.

Analysts surveyed by earnings tracker First Call had been looking for a loss of only $1.08 a share in the most recent period. It wasn't completely clear how the net loss compares to those estimates because most of it was due to charges to write down the value of its inventory and abandon land option contracts, as well as accounting for income taxes.

For those of you who aren't familiar with KB, they build mainly cheap, poorly built (by illegals mainly) 1500 sq ft. boxes, primarily in the SW and California. These are the Las Vegas "entry" homes that they were selling for $350K a year ago. That was before the world woke up and realized $350K for a box in the desert is insane.

I breathlessly await a new round of proclamations that housing has bottomed from the so-called experts. And remember kids, renting is throwing your money away. Buy a house no matter what. Renting is for losers. Home ownership bring pride. And of course NOW IS A GREAT TIME TO BUY. Me, I'll just kick it in my rental, paying a fraction of the cost to own, with cash in the bank earning interest every day. I'm just silly that way.