ValuePlays

About the Author ValuePlays

Todd Sullivan is a Massachusetts-based value investor and a General Partner in Rand Strategic Partners. He looks for investments he believes are selling for a discount to their intrinsic value given their current situation and future prospects. He holds them until that value is realized or the fundamentals change in a way that no longer support his thesis. His blog features his various ideas and commentary and he updates readers on their progress in a timely fashion. His commentary has been seen in the online versions of the Wall St. Journal, New York Times, CNN Money, Business Week, Crain’s NY, Kiplingers and other publications. He has also appeared on Fox Business News & Fox News and CBNC. His commentary on Starbucks during 2008 was recently quoted by its Founder Howard Schultz in his recent book “Onward”. In 2011 he was asked to present an investment idea at Bill Ackman’s “Harbor Investment Conference”, the idea, Audiovoxx, was the top performing name over the following year. Todd also invests in start-up projects and is an angel investor in @Estimize , @milehiorganics @dailyworth @aguaenerviva and is a backer of “Follow Friday the Film” and “Money for Nothing: Inside the Federal Reserve” For more www.about/me/toddsullivan

Housing Continues to Trend Higher

By Davidson

NAHB Housing Market Index for Nov 2015 was reported at 62 with Oct 2015 revised higher to 65. It is always important to take into account the past revisions which color any current report. With housing data the trend has been toward higher revisions which underline the uptrend we can see in the data since the sharp rebound from Nov 2011.Screen Shot 2015-11-17 at 1.23.45 PM

Credit availability, Personal Income and Employment trends continue to support the housing recovery in spite of the tight credit conditions created by a heavy regulatory regime and the impact on credit spreads created by the Fed’s Operation Twist.

Every market has its lessons. But, one lesson which seems lost across time is the strong desire for individuals to provide for their families. This desire for an improved standard of living is in every society and is the primary economic driver which has advanced mankind throughout time. The genetic evidence for human cooperation in this advancement, which we have for eons called “The Golden Rule”, has been building strongly the past 20yrs as scientific evidence has made huge advances.

The most important knowledge of Value Investors which lets them invest when others are racing to ‘high-ground’ is in understanding that throughout human history we have always recovered from self-made disasters. Value Investors are primarily optimists and are virtually the only buyers at market recession lows. Geneticists, anthropologists, psychologists/psychiatrists and neurologists have recently been coming to similar conclusions. Human success has a genetic basis. As an investor nothing can be more positive than being able to count on the human need to improve one’s standard of living for one’s family.

The human drive to own a home in which to raise a family is reflected in the NAHB HMI data. The uptrend is continuing in the current cycle against multiple barriers to ownership. Free markets have always shown that they are more powerful influences than even misplaced government policies.

We should expect the housing market recovery to continue and with this continued expansion in Employment, Personal Income Retail Sales and all those things which lead to improved market psychology and generally higher equity prices.