How did we get here anyway? Housing and construction companies have been crushed as the bubble burst and now investors have to make a critical decision. Do you stay and hope for a recovery or bag it and move to another position that has the potential to provide better returns?

The problem is simple to explain: Most investors hate taking a loss. In fact, most investors will look to get "even" before they sell and this attitude usually leads to greater losses, anxiety and poor decisions. The truth is that much of this can be avoided with proper risk management techniques. If any of this describes you, then consider developing a plan for risk management and a discipline that will help to protect your hard earned principal. Now, more than ever, investors need a plan. We all need a plan that includes well developed risk management disciplines, which is why I dedicate a full chapter to it in my book, The Disciplined Investor.

Monday, June 2

The week begins with the 10 am release of construction spending and the ISM Index. Construction spending is expected to continue to be weak as is the ISM.

Then we have a few housing-related earnings releases that should be of interest. Watch NCI Building Systems Inc. (NYSE: NCS). This company is engaged in manufacturing and marketing of metal products for the nonresidential construction industry. Terrific! This is a company that is suffering along with the entire construction sector...that is for sure. In fact, they company lowered the outlook for the remainder of the year back in March. It stands to reason that not much is better. The ace in the hole is the recent trend of lowering expectations and then coming out with an earnings beat. Even so, this has too much potential for problems and the sideline is a good vantage point to watch the earnings announcement, which is expected to come in with a PROFIT of 31 cents per share on $365 million of revenue. (Uh...That I would like to see.)

Thornburg Mortgage (NYSE: TMA) is still hanging in there. But the losses are mounting. Analysts are expecting a loss of $3.38 per share of this quarter. They are also figuring on revenues to implode and the company to see a $591 revenue shortfall. Ouch! There is good news though. It could be worse, it could always be worse. (Note: This report was delayed since May 15th.)

Tuesday, June 3

New home sales are supposedly on the rise. April saw a rise to 526,000 new sales, up from 509,000 in March. This translates to a 3.3% increase, most of which came from the Western part of the country. The most probable explanation is a simple blip in the trend that can be written off to seasonality or other statistical foible. Housing is still a problem, as the evidence of continued deterioration can be seen everywhere. Specifically, this is showing up as a massive increase in foreclosures, but more importantly, it is not only due to the fact of the problems with the homeowner, but the problems with getting the banks and lenders to agree to finance the sale. Remember, there is still a whopping 10 months of supply on the market. If you are interested, next week, The Disciplined Investor Podcast will examine this and other economic vexings as Michael "Mish" Sedlock and CNBC's Steve Leisman*join in the conversation.

And now back to earnings: Reading the above may not make Toll Brothers (NYSE: TOL) look too appealing. The truth is that of all of the builders, this is one of the few that many had believed would be weather the storm as most of the homes are the geared for the ultra-affluent. Even so, the housing and credit storm is getting everyone wet. There does not seem to be a way to walk between the raindrops with this one. If the phrase "no desert until you eat all of your dinner" ever meant anything, then builders need to slow down and sell their inventory before thinking about breaking any new ground. First Call is looking for a loss of 87 cents per share for the period. As a point of reference, last year TOL earned 22 cents for the same period.

If there is ever a time that we as investors need to learn from our mistakes, now is the time. Run right over to Plato Learning (NASDAQ: TUTR) and take a test! While on the subject of test, the shares have been testing the nerves of investors, testing new lows and testing another breakdown. Volume is anemic and otherwise there is nothing exciting here. Estimates are for a loss of 18 cents a share on $16 million of revenue.

After the close, homebuilder Hovnanian (NYSE: HOV) is reporting. You know what I always say: Builders are like puppy dogs. Puppies will eat and eat until they throw up. Builders build and build until they are bankrupt. Maybe that is a little harsh. Puppies, please accept my humble apologies. HOV is expected to have earnings come in at -$2.64 per share for the quarter on revenue of $759 million. The tide will turn, eventually.

Wednesday, June 4

If you can't stand the heat, get out of the kitchen, and go right to Williams-Sonoma (NYSE: WSM). Admit it! You love that place. The tastings, the pots and pans, the glassware. Maybe it is just me...uhhh, is it? Well, even though this is a great place for housewares and kitchen items, you just have to wonder if this is going to survive the slowdown. Honestly, would you want to be WSM management right now? You have a consumer that is, at best, fickle, credit problems, and Wal-Mart (NYSE: WMT) beating your pants off. Shares could get cooked if earnings miss the expected 1 cent per share that analysts are predicting. Downside risk is toward $22 per share, the first level support.

If I were to live in a box, I would probably have one made by Greif Brothers (NYSE: GEF). This stock has been a great performer and is primed to breakout. Greif manufacturer of industrial packaging products such as steel, fiber, and plastic drums; intermediate bulk containers; closure systems for industrial packaging products; and polycarbonate water bottles, which are complemented with a variety of value-added services, including blending, packaging, logistics, and warehousing. Earnings growth has been outstanding, the industry group has been solid and the fundamentals look strong. If we are seeing a global move that has commodity prices escalating, the value of the timberland that GEF owns in should grow as will the need for containers to ship products around the world. Low debt, 5% net margins and a chart showing a move above the 200- and 50-day average is getting me very interested. Add 2.5 million shares short (9 days to cover) and you have a something to take a close look at. First Call estimates 87 cents per share on $839 million of revenue.

Thursday, June 05

Trina Solar (NYSE: TSL) is due to report. Yes SOLAR! How sick of that word are you? I am just looking for the day that the reports come out about how solar energy is bad and causes some bizarre disease. You know it is going to happen, it always does. TSL is hot as is the entire sector, but has been breaking down of late. Expectations are very high for all of the stocks in this sector, so be careful. Earnings are expected to come in at 48 cents per share on $116 million of revenue.

If you want to know where someone lives, their background and even their phone number, InfoUSA (NASDAQ: IUSA) may be your first stop. This is a company that sells mailing lists, leads and your phone number to those annoying salespeople that have a knack for interrupting dinner. I have been harassed of late on my cell phone from a company that supposedly wants to help me renew my car warranty. Can you say scam? (BTW, if you want to learn more about investment scams, check out the latest MoneyGirl Podcast episode.) But I digress. How about this idea: Boycott the stock to show them that you are sick of it and not going to take it anymore! Stop the madness, stop the annoying calls! Earnings are supposed to come in at 17 cents per share on $173 million of revenue. Oh, one long shot idea...this is a prime takeover candidate for a company looking to gain ad revenue and grow online ad revenue. Any come to mind?

Friday, June 6

Economic releases are what it is all about today. Hourly earnings, nonfarm payrolls, unemployment, and consumer credit will be in the spotlight. FUN, FUN, FUN! Maybe it will be better to take the day off!

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Disclosure: Horowitz & Company clients hold positions in some stocks mentioned as of the publish date.

Andrew Horowitz is a money manager and author of The Disciplined Investor: Essential Strategies for Success. Now available on audiobook!