So Goldman put Simon Property Group (SPG) on conviction buy list and upgraded SL Green Realty (SLG) today. Can anybody guess why? The commercial property sector is the next potential dominoe to fall in the credit mess we are in. This is a funny quote also from Wachovia analyst Carl Reichardt from Dow Jones:
"As a result of lower interest rates, aggressive pricing and the Federal Government's tax credit program for first-time homebuyers, we expect macro-news flow related to customer/builder sentiment and new home sales activity to be increasingly positive over the next four to six weeks,"
He does not say the industry is going to improve, only that the "spin machine" will be touting a "recovery" in these stocks over short term.
Now, why is that? Why is Goldman upgrading these stocks at levels where they have already recovered by nearly double their recent lows? You guess. Yea, Goldman has a huge amount of exposure to the commercial real estate sector as do other "investment" firms and they need to get out before the thing crashes bring wave 2 of losses to their books.
Will the Government bail them out again? Can one say "Awe, those poor commercial real estate developers" the way they can spin "Awe, those poor homeowners"?
Be VERY wary of buying any REIT stock right now, very wary.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment