Lowe's and Lennar

Lowe's cut estimates late yesterday, as they underestimated the severity of the housing slump, and Target cut estimates for September sales. Today homebuilder Lennar came in with bad numbers, losing over $500 million for the quarter, with half of the loss coming from the writeoff of deposits for land for 15,000 homesites that Lennar walked away from. Buyers also walked away from 35% of their contracts. At least these numbers will silence those who said the Fed should have cut only 25 basis points, as now that viewpoint can't be taken seriously. Look for another cut in rates in October.