Noah from Urban Digs has the scoop news on the FBI’s investigation of Beazer Homes.
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Geez. I just wrote a post about this and thought I was the first to know. What the heck.
I’m going to play golf.
fore……
Beazer has shown that one cannot put stock in American products, and it has proven once again that large corporations have no regard for its homeowners or investors. What happened to having pride in American products, and creating satisfied customers on all ends? It is common sense, be honest and fair in your dealings and create wealth honestly by increasing your customer base. It is time for quality to be synonymous with American products once again. Companies that fleece Americans are the greatest imposers of terror on the American people, because they are here and destroying the financial integrity of our country. By cheating consumers BEAZER has added its name to the growing list of greedy, irresponsible destroyers of the financial stability of Americans everywhere. How much money did you lose today?
Wow…that was deep.
Just so we’re straight on who got the scoop here, Urban Digs credited CNBC for the story, which actually carried a piece from Reuters, which credited Business Week which credited … The Charlotte Observer, which produced an in-depth series of stories that began running March 18.
The extent of the FBI’s “investigation” of Beezer at this point seems to that they have read the stories in the Observer and decided they better do something.
http://www.charlotte.com/523/story/55062.html
Way to track down a lead Matt
It is interesting how traditional media share (hat tip) the news.
Seriously Matt. Way to go. Investigative reporting at it’s best! Can we expect an article tomorrow in Inman news?
In general, I expect things like this to hit the industry when the market goes down. Remember when the stock market went down in the early 2000’s? Enron, Tyco, Etc. As far as I’m concerned, it’s all lumped in with the mortgage industry investigations and anything wrong with the real estate industry right now.
The media will always highlight the negative in a down market…no matter what the industry.
Bad news travels fast.
Beazer’s response:
http://ir.beazer.com/phoenix.zhtml?c=98372&p=irol-newsArticle&ID=978771&highlight=
My main point was simply that Urban Digs did not have a “scoop” (nor did it claim to).
The “hat tips” to the Charlotte Observer in media reports are more than a courtesy. Reporters always want to make it clear to their readers where their information is coming from. Others, notably Business Week, have been advancing the story with their own reporting.
The Observer stories look to be extremely well sourced and researched. They are only receiving national attention now — nearly two weeks after the first story was published — because the Feds took notice.
Of course, Beazer has not been charged with anything and the local U.S. Attorney is obviously unhappy about what’s been leaked about the investigation.
hi matt! i changed the word “scoop” to “news”. sorry for the confusion and thanks for your insight.
Whenever I see news like this about a large publicly traded company, I wonder if it is competitive pressures that leads to behavior (assuming that where there is smoke there is fire) that becomes questionable. Will this be an isolated event or will it start to tip other big and seemingly respectable players?
Oops, sorry if I was misleading in my post on this when it came out. I was getting ready for Kudlow when the breaking news was reported on CNBC. Thanks Matt for showing the trail of where it came from!!
I just dont see how this is going to be an isolated event. I have a bad feeling more surprises are in the works in terms of subprime woes, foreclosure stats, and whether it will infect alt-a and prime lenders.
Most importantly, will it lead to tightening of standards to prime borrowers?
If you are correct and this isnt an isolated event, I imagine the industry will end up facing its own Sarb-Ox legislation. Even if we dont end up with legislation, the threat of possible action will force builders & lenders to tighten-up substantially taking all the fuel away from marginal demand (I think I just talked myself into shorting the builders).
The upside (we have to end on a positive note!) is that the Federal Reserve will be lowering interest rates this year taking some pressure off of the ARM resets.