Nearly a decade after the financial crisis interest rates remain at zero. Fed watchers have been arguing for years that policymakers will soon raise rates, only to see the possibility put off yet again (and again and again). While many believe Yellen and company have stuck with ZIRP due to worries about the impact of a hike on the stock market, a bigger concern might be housing.
Last week was no picnic for stocks. With oil prices continuing to implode and a rate hike looking more and more imminent, you’d think a Texas-based homebuilder would have dropped along with the rest of the market. Instead, LGI Homes (LGIH) rocketed from $19 to an all-time high above $24 after it demolished earnings expectations.
As they say in sports, that’s why you play the game.