| GlobeDish.com

With the Neumann Homes bankruptcy news coming out earlier today, one has to wonder how many builders will face similar fates. The cool housing market has made it really difficult for home builders to secure financing for their operations.
Neumann Homes said in a company press release that they were “unable to procure adequate funding” to run the business. It seems that many other builders will face similar difficulties for at least the next few quarters.
The Neumann Homes bankruptcy comes as somewhat of a shock, since they were one of the top ten home builders in the Chicago area. The company said that their lenders were able to help them quite a bit this year, but in the end it just wasn’t enough!

Most of the Neumann Homes employees have already been laid off, and those who have already paid earnest money for homes that haven’t been built will be issued refunds through the bankruptcy court. Let’s hope that happens.

People this is just sad! I have to say that it’s pretty scary for those that are building homes. I have a few friends who own home building companies and they’re having a hard time right now. Let’s hope that the housing market turns around fast so that this business type doesn’t go too sour.

Black Monday happened exactly twenty years ago, on October 19th 1987. The Dow Jones Industrial index plunged a devastating 508 points. The 22 percent drop on Black Monday was the greatest single day drop in history, and on a percentage basis would be equivalent to an astounding 3,000 point drop in today’s market.

Amazingly, the United States did not go into a depression after Black Monday. Most analysts during that time were astounded by how quickly the pain of the day ended, the effects were over almost immediately. An interesting analysis shows you that even if you purchased the index the Friday before Black Monday, you would have had a 12% rate of return between then and now. That’s good money people.

People everywhere are afraid that a Black Monday could happen again. It definitely could, but if you think about it now in retrospect, it really wasn’t that bad.