Lumber prices

Lumber prices are going wacky. In Central Florida, in January, four months ago, a 4’x8’ sheet of ½” plywood sheathing cost about $10.00. Today the cost is $20.00. 84 Lumber expects the price to drop in June, but a hurricane could change that.

The reasons were predicted. (1) There has been a slight uptick in demand. (2) There is no inventory stockpile, and many of the lumber and plywood producers have shut down and will never reopen. (3) The cost of shipping into Florida has jumped because there are fewer flat bed trucks available. When the truckers couldn’t make their payments, they sent the keys to the bank.

This is one of the reasons the Federal Reserve needs to keep interest rates at a level that promotes only needed growth in the housing inventory, and not stupid speculation. The Fed blew it in 2003 – 2006. There is no excuse. Too many good people have been hurt by this recession.

I predicted the end of the boom coming, and sold our last spec house in 2005. At that time I was openly criticized for being too conservative, and was told that I was getting too old. Oh really!

Prior to this, the last severe Recession that was caused by lending excesses was in 1991-92. Can we prevent the next? Support tough banking regulations. Elect moderate politicians of either party, who will govern. We’ve had enough of the power seeking Big Mouths.