KB Homes to Declare Bankruptcy?

You could see the crowd behind the caution tape at the Indymac bank in Pasadena today. There were over 100 desperate people in line despite the FDIC’s best assurances that there is absolutely no rush to get your money out. “Everything is fine” they say on the radio. “Plan on coming down another day when the crowds have died down a bit,” customers were told. FDIC agents served free sandwiches and drinks to the people who stood in line for hours according to one news announcer. Meanwhile a dozen or so news vans peppered the neighborhood. A run-on-the-bank is reminiscent of the great depression and the last Bush Presidency. I remember when the now infamous Savings and Loan Scandal broke causing over 2000 financial institutions to collapse from bad loans. Now Indymac is the latest to fall because of shifty no down, low interest, no documentation, “We’ll lend to anyone” shenanigans. Remember those days? KB Homes stock took off like a rocket back then. But then it all came to an end with the bursting of the residential bubble. Tomorrow General Motors will announce huge layoffs and plant closings. A lot of workers and their families will be hurt by it. Some will say that the two have nothing to do with each other. That the rise in oil prices and the housing bubble are completely separate issues. Perhaps; but one thing is for sure, the workers and the customers are always hurt when something like this happens. Keep an eye on KB Homes this week. If you see more sales offices close, don’t be one of those poor souls waiting to just get out with whatever you can get. I guarantee the FDIC won’t be serving any sandwiches.