What the heck are all the BSC stockholders supposed to do during this fiasco?

I’ve held BSC for 4 years now (yes, I probably should have sold when it was double in price), but I had no idea it would come to this, and I am pretty pissed off.

“If you’re running a business, and for six straight months you’ve been selling fewer and fewer widgets, and then finally you have a month with an increase in sales, that is a good sign. Even if it doesn’t match what you did in the same month in years prior, you have to walk before you can run.”

Your increase in widget sales don’t help you if the price dropped significantly. That’s what is happening here. People are dropping their price expectations because their houses have been on the market for a long time. This is not a sign of recovery, but the beginning of capitulation. You didn’t make any more money on your widgets by selling more at lower prices.

Also, my reasoning holds in comparing February to prior February. I will use a non-real estate example: An amusement park gets more visitors in the summer than the winter. If that amusement park has even less visitors in the winter than normal, and receives a less than normal increase of visitors in the summer, their profit still drops significantly. Just because they had a bump up in visitors in the summer, which always occurs, does not mean they are on a path to make more money. Stats like this are very predictable in businesses, such as real estate and amusement parks, so when they fail meet what happened in the past there is an issue.

Housing markets take longer to drop and recover than the stock market…much longer. This has years to go before the recovery truly starts.

If you’re running a business, and for six straight months you’ve been selling fewer and fewer widgets, and then finally you have a month with an increase in sales, that is a good sign. Even if it doesn’t match what you did in the same month in years prior, you have to walk before you can run.

You’ll never be able to begin increasing year over year numbers until you can begin increasing month over month numbers. So some people will put negative spin on it saying that it means nothing compared to years prior, and others will give it an overly positive spin. I say that it is one of the first positive signs we’ve had in this area in quite a while, and while it isn’t the sign that we’ve hit the bottom, it is still better than another negative month.

The problem with the 2.9% number is that it comes from comparing apples to oranges. The proper way to compare the February number is to compare it to February in prior years.

Feb 2008 = 2.9%
4 year Feb average = 7.2%

Thus, February actually had a major decrease when compared (apples to apples) to the appropriate time period.

Also, note that this year was a leap year, so there was an extra day of sales in this year’s number. This artificially increased the number, which means the 2.9% increase is actually overstated.

On top of that February is always better than January, so an increase from January to February isn’t a surprise, even in a down market.

Don’t be fooled by this, we have a long way to go before housing bottoms and even longer until it starts to go back up.