April 21, 2016 11:15 am eastern

Markets are flat overall this morning. Canadian Western Bank is basically steady (down four cents) which is impressive after gaining about 12% in the past two days. Toll Brothers is up 2.5% and AutoCanada is up 2.1%.

Statistics Canada reports that investment in new single family homes in Alberta was down 25% in February versus the prior year. While that is negative for Melcor it also means that new home building has not ceased. Melcor could still do quite well with home building at 75% of previous levels. What may be more important is whether or not home building lot prices have dropped very significantly. I don’t think land developers are selling lots at desperation prices.

For Canada overall, investment in new housing was up 5.4% to $3.7 billion. Each month Canadian residents and companies invest substantial amounts into new housing. This leads to an ever improving and growing quantity of housing units in the country. Some would question how an economy can prosper by building houses. But houses are a form of tangible real physical wealth. And the need for and desire for good housing is one of the main factors that motivates people to go out to work and trade their time and skills for money in order to buy housing and all the other things people desire. People trading their time and skills for money to buy things is the essence of any economy.