I am talking about the comments on "Squawk on the Street" made yesterday by Stuart Miller, who runs the best homebuilder in the world, Lennar (LEN) , about how tough credit is crimping the home buying business and driving people toward rentals -- a development that keeps the economy from reaching its potential.
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I've known Stuart for ages and knew his father, Leonard Miller; this company has always prided itself on being the least boom-bust of all the companies in the business. Miller sold real estate when it was at a high and bought real estate back when it was at a low, and has amazing sales and terrific gross margins. The orders and the pricing have all been terrific.
The stock's the best performer in an admittedly deservedly lackluster group, despite near record-low interest rates.
But Miller thinks that his company, and the industry itself, would be so much better served if there were more credit being given and mortgages weren't so hard to come by.
It is amazing that we accept the current level of housing starts in this country, about one million, as reasonable given that we would, in another time, Miller says, call that number purely a recessionary figure. It's so far from where we should be, but the banks, he says, are demanding too-big down payments and too-high credit scores.
I thought his answer, when I asked him who is at fault, seemed pretty spot on: no one.
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