You're actually looking at a way to play the housing recovery by buying some of these ancillary names. Give me an example of where your thinking is on this and what stocks seem to be working for you.
NEIL HENNESSY, CHIEF INVESTMENT OFFICER, HENNESSY FUNDS (ON-CAM) ENGLISH SAYING:
Well, I think if you just look over the last four or five years there's been a lot of deferred maintenance that's been done to existing homes. And there was no reason to put money into your home when it was going down in value. But now that looks like it's stabilized, the real estate market, if not coming back a little bit. One way you can play it is homebuilders. That's great. But the other way to play this is ancillary business like a Mohawk or a Pier 1 or a Whirlpool, companies like that, because essentially what you're looking at is people have held off on the purchases to put in new carpet or carpentry or Amasco for new faucets or whatever, or Whirlpool for a new washer or dryer or paint, whatever it is, Beacon Roofing. There's a lot of companies out there that now are going to do very well even if housing does well because they'll still do well with them. But if housing doesn't do as well, they're still going to do well just from the deferred maintenance aspect.
ANCHOR (OFF-CAM) ENGLISH SAYING:
How do you feel about consumer spending overall then? You must feel pretty upbeat about it.
NEIL HENNESSY, CHIEF INVESTMENT OFFICER, HENNESSY FUNDS (ON-CAM) ENGLISH SAYING:
Well, I think the people that have held their jobs through these economic hardship and hard times, I think they're feeling a little more comfortable about going to be continued to be employed. They've been saving their money. They certainly haven't been investing in the stock market. We know that. So they have the cash on the sidelines and I think they'll part with a little bit of it just to spruce up their homes.
ANCHOR (OFF-CAM) ENGLISH SAYING:
What about what's happening with the market right now? I mean the early flows into funds seem to indicate that now there's some retail traction. Is this for real? Is this finally when the retailers come back in?
NEIL HENNESSY, CHIEF INVESTMENT OFFICER, HENNESSY FUNDS (ON-CAM) ENGLISH SAYING:
I don't think that retail is going to be in for a while. I think what's going to happen is once they get their statement in the fixed income arena when rates go up and their principal comes down, I think that's when you're going to attract a lot more money to the market from the retail side. The perception out there is the market hasn't done well over the last three years. It has done very well. And people were still fearful of going back the March of '09. And they don't want to take that risk especially when they see the markets up 100% and they go, I already missed it. Well, you haven't missed it. There's so much more to go in this market, but they're going to still stay on the sidelines until you get back to the late '90s euphoria.
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