Sam Zell CNBC Interview

[Evolveus]

I've always liked Zell's interviews as he typically pulls no punches.  He's got the 20,000ft view of the economy, which also makes his outlook intriguing.  (Un)fortunately there is a good bit of talk that involves politics, but how could it not considering that government decisions, or a lack thereof, play such a big part in the US economic outlook. 

 

I'm posting the zerohedge link with all 3 clips on one page.

 

http://www.zerohedge.com/news/2012-10-02/sam-zell-class-warfare-crap-qe3-unreality-and-why-everything-mispriced-due-fed

[moore_capital54]

Fantastic video. Yet another example of a self made randian hero expressing what should be obvious to any capitalist in the US today.

[giofranchi]

Fantastic video. Yet another example of a self made randian hero expressing what should be obvious to any capitalist in the US today.

 

I know moore_capital54 couldn’t care less… but I agree with him anyway!! ;D

 

Mr. Zell is just great!

 

giofranchi

[giofranchi]

Mr. Mellon’s advice to President Hoover: “liquidate labor, liquidate stocks, liquidate farmers, liquidate real estate”

 

Mr. Zell's advice today: "clear the market"

 

The more things change...

 

giofranchi

[Packer16]

The ironinc part of Pres. Hoover's actions is that he had the right market approach but the wrong monetary approach - tieing the dollar to gold was the worse thing that could be done.  You can see this today in Greece, Spain and Italy.  No matter the fiscal policy these countries are tied to the "euro" standard and until either their debt redonimated in less costly euros or they leave the eurozone the result will be the same.  The other aspect of his statement is the stretching of the pain which will continue until the clearing price is reached.  In the US with a bankruptcy system that allows for quick resoution of over indebtedness, the overleveraged situations can be resolved quickly and folks can move on but the folks in charge now have circumvented this approach by stretching out defaults and providing the false hope of principle reductions. 

 

 

Packer

[giofranchi]

The ironinc part of Pres. Hoover's actions is that he had the right market approach but the wrong monetary approach - tieing the dollar to gold was the worse thing that could be done.  You can see this today in Greece, Spain and Italy.  No matter the fiscal policy these countries are tied to the "euro" standard and until either their debt redonimated in less costly euros or they leave the eurozone the result will be the same.  The other aspect of his statement is the stretching of the pain which will continue until the clearing price is reached.  In the US with a bankruptcy system that allows for quick resoution of over indebtedness, the overleveraged situations can be resolved quickly and folks can move on but the folks in charge now have circumvented this approach by stretching out defaults and providing the false hope of principle reductions. 

 

 

Packer

 

I agree with you 100%.

 

Now what?

 

giofranchi

[giofranchi]

The ironinc part of Pres. Hoover's actions is that he had the right market approach but the wrong monetary approach - tieing the dollar to gold was the worse thing that could be done.  You can see this today in Greece, Spain and Italy.  No matter the fiscal policy these countries are tied to the "euro" standard and until either their debt redonimated in less costly euros or they leave the eurozone the result will be the same.  The other aspect of his statement is the stretching of the pain which will continue until the clearing price is reached.  In the US with a bankruptcy system that allows for quick resoution of over indebtedness, the overleveraged situations can be resolved quickly and folks can move on but the folks in charge now have circumvented this approach by stretching out defaults and providing the false hope of principle reductions. 

 

 

Packer

 

I agree with you 100%.

 

Now what?

 

giofranchi

 

Well, I guess Mr. Zell offered an answer: "The market should be 9000, not 14000..."

 

giofranchi

[Packer16]

I think the one thing Zell missed is the market may be at 9000 based upon what you can buy with US$s in the future or in real terms.  So what we may get is a stagnant marketing with increased inflation and financial repression.

 

Packer

[mvalue]

http://www.calculatedriskblog.com/2012/10/sam-zells-poor-forecasting-record.html

[giofranchi]

http://www.calculatedriskblog.com/2012/10/sam-zells-poor-forecasting-record.html

 

Mr. Zell might be very well wrong about the economy. Many outstanding investors have been wrong about the economy before, and will be wrong again in the future.

What they generally excel at is recognizing when too much (dumb) capital is chasing too few good ideas. That is what they are almost invariably right about.

 

giofranchi