I have been watching lumber prices, as the price of random lengths composite price for lumber has declined from just over $400 to $326 recently. The following chart shows the price of lumber (black line) versus the price of Lennar (ticker LEN, green line)
Is this signalling a slow down in housing, the economy? I am unsure. A number of analyses by people more in the know than myself on this market were expecting a pullback in lumber on an increase in supply. Either way, the above relationship is interesting. And if you asking, yes, lumber prices (black) and the S&P 500 (green) also have exhibited a tight relationship over the last five years.
Is this signalling a slow down in housing, the economy? I am unsure. A number of analyses by people more in the know than myself on this market were expecting a pullback in lumber on an increase in supply. Either way, the above relationship is interesting. And if you asking, yes, lumber prices (black) and the S&P 500 (green) also have exhibited a tight relationship over the last five years.
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