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Sam Zell On "Class Warfare Crap", QE3 Unreality, And Why Everything Is Mispriced Due To The Fed

Tyler Durden's picture




 

"QE-whatever has created artificial numbers that the underlying won't support" is how Sam Zell sums up his view of the Fed's actions, adding that the Dow should be more like 9000, not 14000. The typically optimistic bottom-feeding real-estate magnate says he is not buying here, is gravely concerned about liquidity needs, and in his assessment "everything is massively too expensive." This epic CNBC interview-fest, where the less-than-cheer-leading Zell was allowed to speak, includes his views on a pending recession (as he sees capex planned projects being delayed) and while trying not to play the political card too strongly, he asks that we "stop this class warfare crap" and that the animal spirits are unleashed - as the game is being stacked against him. "We're kicking the can down the road... and with QE, there is now too much capital chasing too few opportunities - even when nobody has confidence in the future!"

Clip 1

  • How does QE3 help?
  • We're seeing too much capital chasing too few opportunities and consequently i think number one the effect of qe3 is nothing more than pushing up the stock market and yet the stock market is being pushed up at record levels of limited trading. we have low volumes and the market goes up, which is manipulation but it's a function of the fact, what's anybody going to do with money and nobody has any confidence in the future,
  • We're on the cusp of going back in a recession
  • How many years have we been kicking the khan down the road. that's a wake-up call for rip van winkle,
    have you ever solved a problem without going to the edge?

 

 

 

Clip 2

  • Unleash the animal spirits, unleash people like me - the game is being stacked against me.
  • Stop this class warfare crap
  • We're watching liquidity like a hawk because there's great sense tomorrow morning it could go the other way, in effect you don't invest as much, you don't take as much risk.
  • Show me any country in the world that has progressed successfully without engaging the animal spirits of their people, and without creating opportunity for their people to excel and push the envelope
  • There are always structural issues...

 

 

Clip 3

  • Delays in capex spending is usually a sign we are headed into recession
  • Not optimistic about consumer spending into the end of the year
  • I am normally an optimist - buying when everything has dropped - but my assessment is that "Everything is massively too expensive"
  • Stock market should 9000 not 14000
  • QE is creating artificial numbers that I dont think the underlying will support

 

 

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Tue, 10/02/2012 - 10:08 | 2848179 slaughterer
slaughterer's picture

Why doesn't CNBC just put David "ballz to the wallz" Tepper on?   He lives almost right next door to their studios.  

Tue, 10/02/2012 - 10:10 | 2848182 GetZeeGold
GetZeeGold's picture

 

 

Just be patient.....I'm sure they'll think of it soon.

 

Tue, 10/02/2012 - 10:20 | 2848210 BaBaBouy
BaBaBouy's picture

"Everything is massively too expensive"

Stop Bitchin... It Will only get MORE EXPENSIVE...

Paper Fiat Is Going To Toast.
They Have No Choice But To PRINT and PRINT...

Protect Yourselves, GOLD $50K ...

Bitchezzz ...

Tue, 10/02/2012 - 10:29 | 2848255 101 years and c...
101 years and counting's picture

you buying gold?  or tungsten?  just sayin....

if you do actually own gold, better hide it somewhere good.  .gov will be confiscating it soon enough.

Tue, 10/02/2012 - 10:47 | 2848306 SafelyGraze
SafelyGraze's picture

am buying mortgage-backed securities

like everyone else

the fed is going to bid up MBS values, so don't-fight-the-fed

 

Tue, 10/02/2012 - 10:55 | 2848340 SafelyGraze
SafelyGraze's picture

"operation twist" for MBS

in the OT headfake, the fed buys up all the long-term debt, forcing everybody else to fight over short-term, equities, real estate. fed doesn't particulary care about long-term debt or return. just wants to drive the herd elsewhere. then let the herd take the loss.

if you don't care about return, which MBS do you buy? why not buy up all the low-risk tranches. drive the herd into holding more of the crap securities. the Nank asserts privilege to buy what he wants to and not disclose the details. hence: twist for MBS.

are you listening, pension funds?

Tue, 10/02/2012 - 10:57 | 2848346 Dr. Richard Head
Dr. Richard Head's picture

The funny thing is that the sheeple believe Benny is buying up the mortgages, when in reality he is buying up banks' deriviative positions on mortgages.  Gotta keep the shadow banking world solvent. 

Baritt Obomny for President - https://twitter.com/FamilyRotten/status/253145132688371713/photo/1

Tue, 10/02/2012 - 11:04 | 2848368 Dalago
Dalago's picture

It was the Senate, then the Kings and now the Bankers/Corporations.  Who will fill the power vacuum when its over?  Hopefully The People, again.

Tue, 10/02/2012 - 11:18 | 2848408 Dr. Richard Head
Dr. Richard Head's picture

Hope is dangerous.  Watching stalwart Republicans excuse Romney's liberal stance and voting record and actually hoping he will do things other than tinkering on the edge of the tax code, makes me realize there is much pain to come. 

Tue, 10/02/2012 - 11:47 | 2848505 malikai
malikai's picture

It blows my mind how much partisan chumps wilfully ignore when it is "their" team.

Tue, 10/02/2012 - 12:44 | 2848751 Bicycle Repairman
Bicycle Repairman's picture

Sam's business model is not working.  Very unhappy.

Tue, 10/02/2012 - 10:47 | 2848312 aerojet
aerojet's picture

Such peurile nonsense.  They don't have to confiscate it to make it worthless.  They could roll out a new currency, one that you need to use to buy things, and then screw you on the exchange rate.  I've been going back and forth on this whole precious metals things--I run right up to the point at which I say I'm going to buy, only to talk myself right back out of it.  The metals play is just too obvious. And anything that is too obvious is a tar pit trapping the saber toothed suckers.  Stackers are going to get skullfucked somehow, it will happen.

Tue, 10/02/2012 - 11:09 | 2848373 Temporalist
Temporalist's picture

Metals too obvious?  That is a joke right?  The propaganda against them is so massive that there is nothing else even to compare it to except the propaganda for anything paper related (equities, debt, bonds, mortgages, etc.).

 

Perhaps you don't realize that less than 2% of the investing population have PMs.  The central banks are just starting to buy gold again (after decades of selling).  And these "stackers" that you call them, how many people do you know in your own personal life that even discuss PMs?  Do you know a single "stacker"?

 

I think people like you have a conceptual problem thinking of going all into PMs as a single investment but if you consider PMs insurance and buy them on a scheduled plan, weekly, monthly, annually then you would have been buying some to protect yourself. 

 

What is more peurile than degrading something you know nothing to little about and acting as if you have a clue?  You aren't even invested in them yet want to deride the whole idea of them.  I know other children that hate rollercoasters because they're stupid...yet have never been on one.  You sound like someone who thinks "well I missed the boat so that boat will probably sink cause I'm not on it."

Tue, 10/02/2012 - 13:13 | 2848876 Diggintunnels
Diggintunnels's picture

Think of it like this.  The people who are prepared to be self sufficient in the event of a collapse believe in gold.  Thus, they will trade needed goods which they have stocked for gold.  I think i should have some gold, just in case.  Fairly simple plan.

Tue, 10/02/2012 - 11:12 | 2848395 tsx500
tsx500's picture

how about many hundreds of years of history .... is that also "too obvious"  ??

Tue, 10/02/2012 - 11:20 | 2848421 Temporalist
Temporalist's picture

I was starving but eating was too obvious.

Tue, 10/02/2012 - 12:07 | 2848584 donsluck
donsluck's picture

Try thousands of years.

Tue, 10/02/2012 - 11:39 | 2848487 Raymond Reason
Raymond Reason's picture

You are playing the victim of mental rape.   You cower like a child that has been repeatedly raped by someone who never gets caught and sees that person as omnipotent.  This is how you see government, by design.    But you are not a child, and you haven't been raped, and the government is not omnipotent.  Take heart, man.   It's a paper tiger, and its tail is on fire. 

Tue, 10/02/2012 - 11:59 | 2848554 donsluck
donsluck's picture

You are making a classic mistake regarding fear. Our logical mind is not good at making decisions, but it is good at taking things apart and analyzing them. It is the emotional mind that is best at making decisions (I know that's against most investment advice). The way to harness them both is to withhold judgement and use the logical mind to read articles (pro and con) and do research. At some point your emotional mind perks up and makes a decision. Go for it quickly because your rational mind will try to talk your way out of it. That is just fear. I have been in PMs for 12 years now, when my emotional mind says BALE I will. No fear.

Tue, 10/02/2012 - 10:22 | 2848224 bigdumbnugly
bigdumbnugly's picture

ever since my youth i wondered how the ez wider guy would age...

never figured he'd show up on cnbc tho

 

Tue, 10/02/2012 - 10:34 | 2848269 Hippocratic Oaf
Hippocratic Oaf's picture

He's right. I'm in fixed income and everything is over-priced and risk-on til after election. Im a seller

Tue, 10/02/2012 - 10:14 | 2848196 slaughterer
slaughterer's picture

CNBC needs a good bulltard on TV to get the "animal spirits" out now that Barton Biggs is no longer doing interviews.  Get Tepper, or Tilson, or Biryani on.  

Tue, 10/02/2012 - 10:20 | 2848216 Temporalist
Temporalist's picture

They were supposed to have Buffett and Munger on but the witchdoctor was busy animating other corpses.

Tue, 10/02/2012 - 12:15 | 2848627 Renewable Life
Renewable Life's picture

First dumbfuck Woody Johnson blows his wad yesterday, now Zell is lining up, these fucking "kings" are starting to panic a little I think!!

Its common knowledge (to anyone with a little history education), that Kings (Corporations) hate to pay taxes, they never have thought taxes where for "them"! The fucking King doesn't pay taxes, this is how the world has been for 5000 years, you peasants in America have gotten way out of line!!  Kings hate Freedom, Liberty, democracy, individual rights, and any other thing that challenges their power! Taxes are for the peasants and the serfs! 

The kings are getting nervous!!! If you start to hear shit about "class warfare", you know they are starting to panic!

Tue, 10/02/2012 - 11:05 | 2848370 williambanzai7
williambanzai7's picture

SAM ZELL 2012

Tue, 10/02/2012 - 10:12 | 2848188 francis_sawyer
francis_sawyer's picture

When are they gonna put Kernen out to pasture?

Tue, 10/02/2012 - 10:14 | 2848192 azzhatter
azzhatter's picture

No shit. Most annoying talking head on TV. Always interrupts with his smartass bullshit

Tue, 10/02/2012 - 11:21 | 2848410 Zer0head
Zer0head's picture

Kernen is a chucklehead, but at least he knows it.  Those aholes over on Bloomberg and I am thinking of Tom Keene et. al. are pseudo econoexperts who tow mayor Mikes globalist agenda and in this politics season spend their entire show cheerleading for Obama.  I'll take Keren and Becky anyday over  Sara dildo Eisen  (taken down from youtube but still available here) 

https://bitly.com/VbvC4Z+  (we would luv William to immortalize this scene)

and that bozo with the bow tie.

And what's the deal between her and Mckee - they were shacked up at one point but I think her new anchor job with Keene has her aiming higher, who knows maybe Gracie Mansion

Tue, 10/02/2012 - 12:01 | 2848561 donsluck
donsluck's picture

And of course these videos seem to think Romney will save the economy. He and his ilk are the ones who trashed it.

Tue, 10/02/2012 - 10:14 | 2848193 GetZeeGold
GetZeeGold's picture

 

 

When are they gonna put Kernen out to pasture?

 

He can come live with us......he loves us!

Tue, 10/02/2012 - 10:39 | 2848286 Big Slick
Big Slick's picture

Seriously???!!  You want to replace Kernen with whom?  Another ideological hack like the 1st grader in there?

Tue, 10/02/2012 - 12:00 | 2848555 dirtbagger
dirtbagger's picture

A poster on naked capitalism said his wife is a producer on Squawk Box.  That would explain a lot.

Tue, 10/02/2012 - 12:57 | 2848809 YouAreBliss
YouAreBliss's picture

No Way  - Neutron Jack loves him.

He's going to host a new segment of "Chairs".

He gets to rant at an empty chair for 20 minutes every morning - like old Clinty.

Great TV!!!

Tue, 10/02/2012 - 15:47 | 2849452 Ruffcut
Ruffcut's picture

HE doesn't want to go to pasture, the zombies will eat him.

Filled with taco bell's mystery meat and ready for din din.

Tue, 10/02/2012 - 10:13 | 2848190 azzhatter
azzhatter's picture

They brought out that smarmy little punk Ackman. It was pretty funny when Zell told Ackman "that's tooth fairy" stuff talking about General Growth. Ackman is a first class asshole

Tue, 10/02/2012 - 10:14 | 2848194 Abraxas
Abraxas's picture

Who the hell is Sam Zell now? Where are these people coming from?

Tue, 10/02/2012 - 10:40 | 2848289 Lost Wages
Lost Wages's picture

Check out the Sam Zell "Controversies" section on Wikipedia. Just another Laizzez-Faire Bootstraps Libertarian who thinks the weak and poor should be used to pave the streets. Too bad fiscal responsibility is so much associated with the heartless.

https://en.wikipedia.org/wiki/Sam_Zell#Controversies

Tue, 10/02/2012 - 15:05 | 2849287 sessinpo
sessinpo's picture

"Just another Laizzez-Faire Bootstraps Libertarian who thinks the weak and poor should be used to pave the streets."

 

Many have paved the streets and many more will. And as long as those people are paid wages that are acceptable to them, that is the way it should be. Part of the middle class of the last century participated and built the infrastructure the politicians now says needs rebuilt. And those middle class workers had fairly good lives, but they also worked hard for it and we aren't talking all engineers.

 

I'm not supporting Sam Zell. I didn't click your link. I'm just responding logically to the ideology. Yes, some people get screwed. People get screwed all the time and life isn't fair. Some even died. You have to take everything in context.

 

 

Tue, 10/02/2012 - 16:44 | 2849661 jstrack
jstrack's picture

Is that really your analysis and your conclusion after reading something from some annonymous person.  It may because it fits your already preconcieved notions.  By the way, the article is wrong...its not a mobile home park...its a freaking manufactured housing community...LOL lol lol...

Tue, 10/02/2012 - 10:22 | 2848220 DaveyJones
DaveyJones's picture

The Fed prefers Diarrhea

Tue, 10/02/2012 - 10:24 | 2848231 Cognitive Dissonance
Cognitive Dissonance's picture

Yes.........because as we all know it is the flow and not the stock that matters.

Tue, 10/02/2012 - 10:31 | 2848258 DaveyJones
DaveyJones's picture

and things are getting harder to digest

Tue, 10/02/2012 - 10:32 | 2848264 Cognitive Dissonance
Cognitive Dissonance's picture

As the world stomach turns churns.

Tue, 10/02/2012 - 10:50 | 2848323 DaveyJones
DaveyJones's picture

followed by The Young and the Restless

Tue, 10/02/2012 - 15:49 | 2849463 Ruffcut
Ruffcut's picture

Really the old and the ruthless.

Tue, 10/02/2012 - 10:14 | 2848198 Temporalist
Temporalist's picture

One thing Becky isn't quick about is shutting her mouth.

Tue, 10/02/2012 - 10:21 | 2848199 WhiteNight123129
WhiteNight123129's picture

Fry real estate with long bond yield rising and rising and frying up capital owners (bonds and equities) with monied capital converted into circulation.

 

THERE ARE ALTERNATIVE YOU OLD FART! SELL YOUR LEVERAGED ASSETS (FINANCIAL ASSETS) AND SPEND! THE FED IS SCREAMING GAME OVER FOR CAPITAL OWNERS. BOOM TIME FOR FARMERS.

I come from farming family. Ben Bernanke is my hero. We agree there is too much monied capital to circulation, the solution is to sell your financial assets and spend. There is no more room for trying to extract anything from circulation into financial assets, time for financial assets to be spent (bonds) into circulation. Game over PIMCO, FUCK YOU SAM ZELL, THE FED IS POINTING THE GUN ON YOUR IDLE LARGE MONIED CAPITAL, BEN BERNANKE IS POINTING ITS GUN ON YOUR LARGE DOLLAR BANK ACCOUNT. Spend and pronto, the Fed will fuck you. You will forced to release your dear currency units in the circulation and that will fall in the pocket of the consumer, and the consumer who was leveraging up to prop you up old farts (PIMCO and ZELL) is now going to receive a lot more nominal confettis and will pay easily back his mortgages....

Super Ben Bernanke is there to burn the bondholders to a crisp and real estate and force those guys to spend... Evil fucking great genious, Ben is the man. BERNANKE! BERNANKE! Bond traders, fuck you, fuck you, and fuck you (unless you are short the 30 years, which then you command my respect for having vision and guts.)

 

 

 

 

 

Tue, 10/02/2012 - 10:52 | 2848329 MachoMan
MachoMan's picture

This would be a neat theory but for the fact that there is no present mechanism for our monetary nor fiscal policies to actually reach J6P.  Wages are stagnant to declining...  and, inflation adjusted, are getting hammered.  I agree our present monetary policy is waging a war on currency (hint: find alternative forms of wealth storage), which tends to impact large capital holders...  but, it's a pretty large stretch to think that J6P will see any benefit from the prolifigacy...  house notes will not be easier to pay off in our present stagflationary scenario.

Tue, 10/02/2012 - 12:06 | 2848581 donsluck
donsluck's picture

Clear thinking. The Fed is printing money and burying it in the primary dealers accounts at the Fed. There is no transmission mechanism into the general economy using the Fed's current program. The government cannot build jobs, it's up to private business and the Fed is scaring them into holding onto their cash. Me included.

Tue, 10/02/2012 - 12:57 | 2848810 WhiteNight123129
WhiteNight123129's picture

Do not hoard you cash, in 1980 the FEd was rewarding to be idle and not enter circulation yet everyone trashed bonds and wanted Gold. Now you are getting massacred by hoarding cash and you want to keep holding it? Explain that to me.... Because right now everyone sitting on liquidity and look at each other winking and saying "we are good?" and the other side says " we are good". When they finally realize how crowded they are, they will want to rush to the exit. You better be on the other side of the door when that happens, otherwise you will get squashed like a melon.

CASH IS THE MOST CROWDED TRADE ON THE PLANET RIGHT NOW.

 

Tue, 10/02/2012 - 14:00 | 2849054 DR
DR's picture

 

Everyone wants to be an investor, no one wants to do the hard work of being a producer-me included.

Tue, 10/02/2012 - 15:07 | 2849294 passwordis
passwordis's picture

 Absolutely and it's been like that since the very beginning. The creation of man was the result of the desire for someone else to do the hard work. That's what the oldest writings on earth tell us anyway and that's what the bible tells us. Adam was created in order to work the lands- it's right there in Genesis- so the Gods could do whatever it is they do.

Humans were created for the specific purpose of worshiping (of which the root word in Hebrew means to work or to serve) the gods. Worship does not mean to kneel down and praise the gods. It means to work and serve the gods.

- Nothing has changed in 200,000 years. We are still ignorantly working for the gods. God told man not to eat from the tree of knowledge. The Gods love ignorant stupid people.

 

 

Tue, 10/02/2012 - 12:52 | 2848791 WhiteNight123129
WhiteNight123129's picture

Well check prices dynamic between 1836-37 (country banks collapse in UK), wild cat banks in US. Deflation first, then flat, and then monied capital enters circulation Gilt yield rises and prices rise copiously. The deflation of 1873-1896 was self-inflicted due to demonetization of Silver (fortunately cyanide came to the rescue along with the WitzwatersRand Gold deposit finds). Check dynamics of commodities post 1933 printing CRB Jeffries commodities index until 1950. Check the study of sequence from Sovereign debt crisis by Kenneth Rogoff always ends up with copious inflation as a solution to the problem (wack financial assets).

Next ask yourself why both Hugh Hendry and Ray Dalio are worried about deflation now (because monied capital is frozen) but then they worry about inflation in 5 years (because the large pile of monied capital enters circulation and unfreezes). There are massive amoutn of liquidity frozen doing nothing right now, what those need a is a jack-up of inflation expectation with War Drumming up (always work to warm price increase expectation historically) have Bernanke look like a crazy printer, scare them to death and point the flames thrower gun on them, and they will dishoard.

In Metallic system you can never ever scare the hoarder that they will lose their money and the best way to avoid that is to spend it now, so the confiscatio of Gold was teh reason for that.

The Fed does not need to confiscate Gold, a higher price of Gold is the ally of hte Fed because it scares people hoarding cash and doing nothing with it.

 

Tue, 10/02/2012 - 13:18 | 2848873 WhiteNight123129
WhiteNight123129's picture

The most potent weapon that exists, is not the printing press, it is psychology and fear. Fear will force people to get rid of their cash. The Fed has cornered the bond market, if they want the long bond at 4% they can do it tomorrow by dumping a bit of treasuries and get everyone scared right away from holding cash and bonds. They want you to get slowing out of cash, very slowly, at a measured pace.

YOu have to scare people into inflaiton very very slowly in order to avoid crack-up boom.

So that is why initially the Fed says ok, I will need to print only for 2 years, and everyone is like huh?

If the Fed had said back then they will print until people get rid of their cash, you had crack-up boom in 2009.

Now that we have a little less problems in the economy, teh Fed can come out because hyperinflation has not happened, so people are less worried about it,

So now the Fed can go and say: I WILL PRINT MONEY UNTIL THE ONES WHO HAVE CASH SPEND IT.

Then those guys will spend and then the Fed will stop printing. What the FEd wants, the Fed gets.

Do you think it is even possible for Lehman to go bankrupt without the Fed saying ok?

There is no limit to money printing, in Gold there is a limit, in fiat none. So if the Fed wanted to write 500 billion check to save Lehman, there is nothing to stop them.

The problem is that we would have everyone cheer like post LTCM bail-out and we would have gone back to leveraging up.

So the Fed decided that the leverage cycle had lasted enough, that a big bank would need to be sacrificed and that from now on, the Fed would print money create inflation and force deleveraging and have the economy start to function counterclock wise (from monied capital into circulation).

Any economist worth his salt (that means having read XVIII and XIX centurry stuff, knows that a fiat system is bound to go from extreme low interest rates to extremely high with extreme leverage to extreme deleveraging back and forth)

That is the price to pay to avoid hard bust system. In hte XIX century, in the UK we had bank of issues fail. Meaning your bank notes were actually defaulting so they were different bank notes so to speak and people at the bottom would have to absord 60 cents on the dollar loss or 100% on their bank notes because the Gold was not there anymore....

Now everyone wants the Gold standard? Please.... Ignorance of the bank of issues trouble of 1836 I guess. Do you think Bernanke does not know the situation of Bank of ISsues of 1836, do you think he does not know what happened with the Bank of England Charter of 1844. No system works, they are all imperfect, you just need to know how the different systems function.

 

Tue, 10/02/2012 - 10:14 | 2848200 fonzannoon
fonzannoon's picture

But Cramer said.....

Tue, 10/02/2012 - 10:23 | 2848226 tocointhephrase
tocointhephrase's picture

He is such a jizz stain, don't know how the guy sleeps at night!

Tue, 10/02/2012 - 10:15 | 2848201 sickofthepunx
sickofthepunx's picture

tea bagger circle jerk every morning on cnbc

Tue, 10/02/2012 - 10:33 | 2848268 RSBriggs
RSBriggs's picture

Tea bagger?  You have things completely ass-backwards.

Tue, 10/02/2012 - 10:18 | 2848204 RiverRoad
RiverRoad's picture

Sam says, "too much capital chasing......"  Hmmm, isn't "too much capital" indicative of inflation?  This beautiful deleveraging may get ugly soon.

Tue, 10/02/2012 - 10:22 | 2848221 NewWorldOrange
NewWorldOrange's picture

Well, yes, in the manner he used the word "capital", which was kind of loose with the language to say the least. What he should have said was "money", or better yet, "fiat currency" or even just "currency."

Tue, 10/02/2012 - 12:16 | 2848633 blunderdog
blunderdog's picture

You can pretty much ignore any one of the teevee blowhards who doesn't know the difference between "capital" and "money."

They'll have good speeches, but they'll be hopelessly self-contradictory.  Can't learn a thing from 'em.  GIGO.

Tue, 10/02/2012 - 12:24 | 2848666 Urban Redneck
Urban Redneck's picture

The more problematic question is why are there too few opportunities in the developed markets, for the available amount of capital (which is more easily manipulated to match the former)?

Tue, 10/02/2012 - 10:19 | 2848211 LawsofPhysics
LawsofPhysics's picture

The Fed has destroyed the "market", there is no pricing mechanism anymore, in capital markets equity markets or asset markets, period.

Fraud is the status quo, possession is now the law.

Those close to the "free money" have benefitted immensely by "buying off" the idiot poor with trinkets and toys.  Those in the middle that actually create real things of real value have been supporting entitlments of both the rich and poor - not sustainable.

hedge accordingly

Tue, 10/02/2012 - 10:24 | 2848234 NewWorldOrange
NewWorldOrange's picture

Que "Keynesian economist" aka QE OxyMoron:

"What's a price mechanism?"

Tue, 10/02/2012 - 10:29 | 2848240 DaveyJones
DaveyJones's picture

allege accordingly

this isn't over until a good number go to prison

Tue, 10/02/2012 - 11:02 | 2848366 NewWorldOrange
NewWorldOrange's picture

We're gonna' need more prisons. Rope is a lot cheaper.

Tue, 10/02/2012 - 11:48 | 2848508 Renewable Life
Renewable Life's picture

No need for rope or prisons, have you seen the current stats on ammo sales in the US??? You might want to! And include the government sales in there too, thats even more scarey!

Tue, 10/02/2012 - 12:31 | 2848692 Urban Redneck
Urban Redneck's picture

Some evil capitalst pig horders have more than their fair share of ammunition,

However, any attempt by the State to collect and redistribute that ammunition on a more equitable basis is likely to result a much higher velocity handover to the State than it would like- (sort of like those "sterilized" transactions)

Tue, 10/02/2012 - 10:41 | 2848288 WhiteNight123129
WhiteNight123129's picture

The financial market NEED to be destroyed, people need to forget about trying to make money into financial assets. Spend your finanical assets is the message from Ben Bernanke. Beautifull.

Fuck the capital owners so those guys get a real job plowing the earth instead of trading trinckets. There is too much debt to GDP = There are too many financial assets to GDP (since your debt is my asset).

First resolution = bankrupcties everywhere.

Second resolution = spend you bonds and nominal GDP goes up a lot in relation to financial assets (debt).

GDP TARGETING PRONTO! Fuck the market, that is all the majority of the guys playing with it deserve. Hugh Hendry is right, you want to short people like you if you are in the financial market job (Which I am). You want bond holders to sell those and spend. You want corporations to stop hoarding cash uselessly and you want the consumer to be at the other hand of the Rich and Corporations forced to dishoard their dollars because the Fed is warning up the water of those cold loving frogs, you want the mortgage debt to vanish in confettis, you want the credit card debt to vanish in confettis, you want the re-instatement of usury laws (credit cards) you want prudential rules on banks like in Hong-Kong. But first confetti party, burn PIMCO to crisp, BURN ZELL to crisp, force those fuckers to spend their large dollar account.

 

 

Tue, 10/02/2012 - 10:49 | 2848315 LawsofPhysics
LawsofPhysics's picture

Relax and try not to stink of fear so much.

That which cannot be sustained, won't be.

Know the real value of your labor?  Time for everyone to find out.

I say bring it, bitchez.

Tue, 10/02/2012 - 12:42 | 2848648 WhiteNight123129
WhiteNight123129's picture

Wages and price rising are the smae thing. That is why today[s rise in price have little to do with US wages but global wages and supply demand and a bit of hard asset ~jog~.  Inflation has two definition, the first one is during a leverage cycle, overtrading pushes a bit wages (the top of the leveraging cycle) but structurally we are in declining long bond yields, leveraging up and deflationary situation. Once you manage to get the flow inverted, that is from monied capital into circulation (deleveraging) as opposed to circulation into financial assets (leveraging), the inflation becomes structural with bouts of slowdown (and lower prices at the bottom of the cycle). This continues until the nominal GDP is high in relation to financial assets.

My worst fear is to fail to reduce my PM timely when the 30 years kick at 4%, because when that happens, that means inflation process of converting monied capital into circulation is kicked-started. At that point the Fed will not print into a inflation tolling at 4%.This inflation will not come from leveraged consumers, it will come from a bit more of leverage from corporations, and dishoarding of companies with net cash and people spending their bonds. There are way many people thinking the Fed prints to infinity. The Fed wants wage inflation, when it gets it, it can watch the liquidity self destruct by being spent and pushing up wages and prices up and GDP nominally up against debt (financial assets.)

 

In 1980 the Fed was rewarding massively monied capital to stay idle and not jump into the circulation. The kings of the day (commodities trader) hated the FEd, yet noone wanted liquidity and long bonds, everyone wanted GOld.

Today, the Fed is punishing massively monied capital for staying idle and not jump into the circulation. The kings of the day (PIMCO and bond traders) hate the Fed, yet everyone wants to stay in bonds and are lukewarm about Gold.

Stupidity again, and again, and lack of vision.... short the 30 years bonds (either the US is bankrupt, or the Fed manages to create inflation).

 

 

 

Tue, 10/02/2012 - 10:19 | 2848212 Shizzmoney
Shizzmoney's picture

Squawk Box sucks so fucking much.

How anyone thinks they can watch this crap and know more about the markets astounds me. 

BTW Sam Zell looks like a retired Leprechaun.

Tue, 10/02/2012 - 10:27 | 2848251 resurger
resurger's picture

welcam to Sqwaaaaaaaaaaak Baaaaaaaaaaaaaaax!

Tue, 10/02/2012 - 10:43 | 2848296 azzhatter
azzhatter's picture

looks like a garden gnome

Tue, 10/02/2012 - 11:00 | 2848357 FMR Bankster
FMR Bankster's picture

It does suck but that's because there's about 5 minutes of real economic news you might need to know and these clowns have to have something to say for hours and hours each day or they lose their $500,000 a year gigs.

Tue, 10/02/2012 - 10:20 | 2848215 buzzsaw99
buzzsaw99's picture

"stop this class warfare crap"

 

The 99% didn't start this war but we damn well may finish it. Suck it Zell.

Tue, 10/02/2012 - 10:27 | 2848237 Cow
Cow's picture

Comment indicates that you don't know much about Zell.

Tue, 10/02/2012 - 10:33 | 2848263 buzzsaw99
buzzsaw99's picture

fuck you and the horse you rode in on cow. zell is the worst kind of maggot.

Tue, 10/02/2012 - 16:52 | 2849691 Blankenstein
Blankenstein's picture

.

"the worst kind of maggot"

 

So true.  The man who calls himself the "grave dancer" is the largest mobile home landlord in the country. His company was called Manufactured Home Communities, but now operates under Equity Lifestyle Properties. 

 

Tue, 10/02/2012 - 17:48 | 2849846 Cow
Cow's picture

What's wrong with owning mobile home parks?  Also, he buys low and sells high.  He waits until prices are low.  Do you think that is bad?  What a dumbass.

Besides, he takes big risks.  They all don't pay off, but he's a big boy.  He lost his ass on the Trib.  What a stupid move that was.

Tue, 10/02/2012 - 19:50 | 2850177 Blankenstein
Blankenstein's picture

There is nothing wrong with owning mobile home parks, but Sam Zell has a reputation for buying these properties and jacking up the rent to unaffordable levels.  Most mobile home residents aren't flush with money, but it seems he has no problem doing this and using his lawyers to bully municipalities to get rid of rent controls.  He might like to make himself out to be a traditional investor, buying assests when the prices are low and then selling when high, but just like with Warren, when you pull back the curtain, that grandpa buy and hold investor with the folksy charm is just a facade.  

 

 

Tue, 10/02/2012 - 10:50 | 2848321 LawsofPhysics
LawsofPhysics's picture

Yes, Zell has done well in these decades of fraud.  But perhaps that isn't what you meant.

Tue, 10/02/2012 - 13:07 | 2848850 YouAreBliss
YouAreBliss's picture

Sammie had old Rod up his ass, and Rod returned the favor.

 

From Wiki:

"Zell was implicated in the corruption charges against former Illinois Governor Rod Blagojevich. The charges claimed that Blagojevich had pressured Zell to fire particular Tribune editorial staffers, known to be harshly critical of the governor, in exchange for tax breaks on the sale of Wrigley Field. An aide to Blagojevich reported back to the governor that Zell "got the message and is very sensitive to the issue." The District Attorney's office later concluded that the aide had not in fact approached Zell and was lying to the governor." 

Tue, 10/02/2012 - 10:22 | 2848222 resurger
resurger's picture

They banned this clip or not yet!

How can they post something like that on an election year?

Tue, 10/02/2012 - 10:22 | 2848223 Quinvarius
Quinvarius's picture

Money printing still causes inflation, Sam.  No matter how much Fed Apologist Paul Volcker states otherwise, creating money and buying stuff with it is inflationary.  This is where you live now. 

Tue, 10/02/2012 - 10:30 | 2848245 HungryPorkChop
HungryPorkChop's picture

This sounds similar to the Libertarian candidates message.  Get the govt out of the way and allow growth in the job markets.

Tue, 10/02/2012 - 10:27 | 2848247 Milton Waddams
Milton Waddams's picture

Summary:  "Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate."

Tue, 10/02/2012 - 10:27 | 2848250 MiniCooper
MiniCooper's picture

I like Sam Zell because he speaks a lot of sense. He is a value investor too and he is damn right. There is no value left in the stock market or property market.

A man called John Moulton who is another value investor but in stock and real businesses in the UK says very similar things.

You can make mioney in a bull market by pure luck - just go long and hold. Long term real money making in buying cheap asets when no one else will and managing them and selling them when too expensive based on real fundamanetals is how the economy would work if central banks would just get out of the way. Young people could get a start in life, buy a home, get a cheap piece of real estate to start a business in. None of that is possible while assets are this inflated.

Massive misallocation of capital everywhere.

Tue, 10/02/2012 - 10:40 | 2848281 Quinvarius
Quinvarius's picture

I advise you to buy everything that is not nailed down, insolvent, or a just a paper promise to pay out in paper dollars.  The stock market is breaking out, like it or not.  Inflation makes prices rise.  We are well over the edge on printing and cannot stop because the banks are still insolvent.

Tue, 10/02/2012 - 10:52 | 2848327 Conman
Conman's picture

When people start talking about the market breaking out - thats the time to sell.

Tue, 10/02/2012 - 12:26 | 2848676 Lewshine
Lewshine's picture

Quin, I think you miss the greater point Mr. Zell was trying to make. Your thesis is absolutely correct, the potential for higher asset prices are an actual result of Ben's printing. THE PROBLEM with this theory is YOU and anyone buying these assets are paying inflated prices IN A PSYCHOTIC ECONOMIC ENVIRONMENT. YOU are paying for these assets that are fraudulently priced. See, the game works as long the provoked system remains, IE; Think any pyramid scheme. But we all know by logic and history that this doesn't end well, EVER. So...You, by protecting yourself in buying these rising assets are the greater fool because you will lose a lot more than the person who is not provoked, and ultimately buys that asset from you when the system breaks - and it will. There were more people buying real estate in 2007 than in 2006, 2005, and 2004...Combined. They too, were for the most part, protecting themselves from a potential loss (of gains) by buying property at nosebleed levels...Just as you are today. We had 4% unemployment in 2007 and the Dow at 14400, with 3.5% growth...And still got killed in holding stocks and real estate.

Look at the ocean of the unemployed (buyers of your recently acquired assets), and the world's zero growth today, and tell me with a straight face that YOU ARE NOT THE FED'S CHUMP!

Tue, 10/02/2012 - 14:57 | 2849189 DR
DR's picture

You need to distinguish between asset inflation( capital class) and price inflation( labor class). Most of QE has gone into inflationing assets with the Fed hoping that the capital class would monetize this gain by buying and increasing real productive investments with the effect of greater job creation- in essence supply side economics. The Fed is puzzeled why this isn't happening and why the Zells of the world are just hoarding their gains.

 

 

Tue, 10/02/2012 - 10:34 | 2848270 SilverDOG
SilverDOG's picture

Self employment, small business, light manufacturing, invention/patent pursuit; all are

inhibited by regulations(equals costs), taxation, and FEE FEE FEES!

Indentured slavery automatically installed by the state, as one attempts any or all of above.

 

 

Tue, 10/02/2012 - 10:37 | 2848279 LawsofPhysics
LawsofPhysics's picture

in the meantime the banker and other paper-pushers in the financial sector (who contribute nothing of real value) have no regulation at all.  - FAIL.

Tue, 10/02/2012 - 10:54 | 2848334 DaveyJones
DaveyJones's picture

it's almost as if....they make the rules

Tue, 10/02/2012 - 11:37 | 2848480 logos5
logos5's picture

"I see an innumerable crowd of like and equal men who revolve on themselves without repose, procuring the small and vulgar pleasures with which they fill their souls. Over these is elevated an immense, tutelary power, which takes the sole charge of assuring their enjoyment and of watching over their fate. It is absolute, attentive to detail, regular, provident, and gentle. It would resemble the parental power if, like that power, it had as its object to prepare men for manhood, but it seeks, to the contrary, to keep them irrevocably fixed in childhood . . . it provides for their security, foresees and supplies their needs, guides them in their principle affairs . . .

The sovereign extends its arms about the society as a whole; it covers its surface with a network of petty regulations?complicated, minute, and uniform?through which even the most original minds and the most vigorous souls know not how to make their way . . . it does not break wills; it softens them, bends them, and directs them; rarely does it force one to act, but it constantly opposes itself to one’s acting on one’s own . . . it does not tyrannize, it gets in the way: it curtails, it enervates, it extinguishes, it stupefies, and finally reduces each nation to being nothing more than a herd of timid and industrious animals, of which the government is the shepherd."              

   Alexis de Tocqueville

Tue, 10/02/2012 - 10:36 | 2848278 lindaamick
lindaamick's picture

This guy is an idiot.

Basically his message is:  allow deflation of assets but talk up the economy with positive words.

Do you really think the banksters would go for that?  They HATE deflation.  It reduces their holdings since they own the assets. 

This guy is talking his book.  He wants cheap real estate.

Tue, 10/02/2012 - 10:43 | 2848300 Dr. Engali
Dr. Engali's picture

How is he an idiot? Real estate needs to be cheaper so we can move on past this mess. These false floors will not let the market clear. It's been over priced for years and it remains over priced.

Tue, 10/02/2012 - 14:24 | 2849128 DR
DR's picture

The market is the Fed and they aren't going to let asset prices fall because it would cost too much to bail out the banks and pensions. Isn't that the lesson of the last financial crash? Of course current assets are priced nominally which means when you want to cash them in you will be lucky to get your principle back in cost inflation terms and I wouldn't look forward to a real yield.

Tue, 10/02/2012 - 13:13 | 2848879 JuliaS
JuliaS's picture

Enjoy your recovery, because things are exactly as you want them to be. Elevated prices, no deleveraging, expensive real estate, happy times, ranbows and unicorns.

Tue, 10/02/2012 - 10:38 | 2848285 optimator
optimator's picture

Didn't you see the humor.  Zell started talking about CEO's being part of the problem and the second Jeffy Immelt and GE was menntioned Zell was overridden wiith subject changing words from all the CNBS folks.  I'm sure Zell knew that was a No No!

Tue, 10/02/2012 - 10:39 | 2848287 resurger
resurger's picture

http://www.bloomberg.com/video/84758540-djia-to-fall-4-000-points-in-201...

Soon Granville ...

Are they going to call him back when the Dow is 2,000

Tue, 10/02/2012 - 10:44 | 2848298 Quinvarius
Quinvarius's picture

Every market crash was a banking panic.  You think that is possible with no mark to market for banks, 0% loans to bankers, and the Fed paying out on all their bad trades? 

Tue, 10/02/2012 - 10:49 | 2848318 resurger
resurger's picture

what do you think?

Tue, 10/02/2012 - 15:12 | 2849310 Panafrican Funk...
Panafrican Funktron Robot's picture

"You think that is possible with no mark to market for banks, 0% loans to bankers, and the Fed paying out on all their bad trades?"

Yes, particularly if you consider that banking panics are intentionally manufactured. 

Tue, 10/02/2012 - 10:43 | 2848295 poor fella
poor fella's picture

Zell is doing just fine....

He grows the soul patch to tickle the balls of the 'cheap money' cock he loves to suck so much. Immelt, Palmisano, Welch, and all the others 'don't like the American situation' today either. The same fuckholes happy to chip out the foundation for a buck at every turn. All doing just fine...

Tue, 10/02/2012 - 10:43 | 2848299 poor fella
poor fella's picture

Mozilo has an opinion also.

Tue, 10/02/2012 - 10:45 | 2848307 azzhatter
azzhatter's picture

In a just world, Immelt, Palmisano and Welch would be hanging from a tree

Tue, 10/02/2012 - 10:55 | 2848337 NumberNone
NumberNone's picture

Zell oversimplifies it but the poor are subsidized to the point where the private sector is having trouble competing.  The federal government has become the world's largest employer and it is paying people not to work.  

Personally know businesses that are desperate for help but the people that used to be their target hires these companies can no longer afford to pay them to do the work.   I'm talking mom & pop shops that live on a razor's margin and bumping someone's salary a couple of bucks an hour to entice them to join is not an option.   It's fucking crazy how out of whack the employment marketplace has bcome due to Big Gov Co. largesse. 

Of course these small business owners didn't build their businesses so they are no better than the subsidized poor in the eyes of the government.  They should just be grateful to the bounty the government is providing all. 

Tue, 10/02/2012 - 10:57 | 2848345 Nobody For President
Nobody For President's picture

Off topic, but the best headline of the morning (from Bloomberg):

 

Intelligence Exits Washington, Vacancies Rise: 

 

 

Not really news, actually...

Tue, 10/02/2012 - 11:00 | 2848359 Falkor
Falkor's picture

"Kicking the khan"!! 

 

When did you start becoming racist?

Tue, 10/02/2012 - 11:01 | 2848362 Bay of Pigs
Bay of Pigs's picture

Scorched Earth policy eh Sam? Good times. 200M Americans living in poverty.

Is the FED still in control and printing the money after everything is liquidated? That solves nothing.

 

Tue, 10/02/2012 - 11:01 | 2848363 Wtfcity
Wtfcity's picture

I actually saw this ass-clown this morning before I left for work. Bitching and moaning about class warfare. Jeesh! When class warfare is working for people at the top its business as usual. When people start to understand that the system is rigged for people at the top and say enough all beneficiaries start to complain.I'm just tired of these blowhards fucking complaining after raping and getting bailed the fuck out. He claimed the same loopeholes the rich get , everyone has available. Tell that to the small businesses who will pay for Obama care and the large corporations that got fucking waivers.Fuck this asshole and his ilk!!!!

Tue, 10/02/2012 - 11:08 | 2848382 paulbain
paulbain's picture

Tyler Durden wrote:

Sam Zell On "Class Warfare Crap", QE3 Unreality, And Why Everything Is Mispriced Due To The Fed

On the one hand, I agree with most of that which Sam Zell says here, but, IMO, Sam Zell is not very smart. Review, for example, his remarks regarding the newspaper industry and Google. From these remarks, it is clear that he does not understand the Internet:

"If all of the newspapers in America did not allow Google to steal their content, how profitable would Google be?" Zell said during the question period after his speech. "Not very."

[snip, snip]

Zell said the current arrangement between newspapers and search engines "can last for a short time," but not longer. "We're going to see new formulas in the immediate [future] that reflect the cost benefit," he said.

These remarks were reported in 2007 in the Washington Post:

http://www.washingtonpost.com/wp-dyn/content/article/2007/04/06/AR200704...

Sam Zell may be smarter than the average bear, but it is obvious that, in some respects, he is clueless.

Paul D. Bain

paulbain@PObox.com

 

Tue, 10/02/2012 - 11:13 | 2848398 Dawnofinsanity
Dawnofinsanity's picture

Anyone is a wealthy man is sure to tell you he's a wealthy man.  I say by that voice sit at home play golf, you've only got a few years to live. 

Pick your poison, bankster or HMO guaranteed that one of them will take you for a ride.

Tue, 10/02/2012 - 11:24 | 2848435 GFORCE
GFORCE's picture

Love listening to experienced risk-takers give their view and tell it how they see it. Need more guys like Sam running the instead of career politicians with no street smarts or business acumen.

Tue, 10/02/2012 - 12:52 | 2848775 YouAreBliss
YouAreBliss's picture

You're fucking nuts.  He'd appoint himself dictator for life.

Tue, 10/02/2012 - 11:40 | 2848488 dcb
dcb's picture

sorry sam, the class warfare exists. folks like you have a lot of money in the market, not tthe average folks. the bank of england released a papaer claiming qe creates wealth inequality. the fed program is class warfare.

 

I don't disagree with him, but he is the class that benefits the miost from the loose money, not regular folks

Tue, 10/02/2012 - 11:45 | 2848499 Fort
Fort's picture


Break some eggs. Take responsibility and get governments of our backs and for god's sake allow banks to fail, regardless of how devastating that might be. Clean up the mess and let's return to the old normal this insanity has taken long enough. Somebody posted that US was worse than Europe. Maybe, maybe not, what ECB and FED and other CB's are doing is holding the I can screw up my currency even more than you competition, we will keep upper hand in this battle for the worst peg.

I think most of the structural problems we have are the result of globalization and the solution will never be found in even more globalization or in more centralized power. Allowing the system to take the hit will resolve most of the structural problems we have globally. The biggest structural problem is centralization; if we want to benefit from technological advances in the world we need more decentralization. Nobody can deny that almost every company in the world has been able to improve productivity in the last decade or so as a result of improved production methods and improving process efficiency, yet no improvement has trickled down to household disposable income. Why not? I mean if the invention of the car had such an impact why on earth PC and internet didn’t have a similar impact. The Dutch owed most of their golden age success to the invention of the saw mill. Look at household disposable income internet and PC penetration and all software made for it; it simply has had no effect of all. This is because any positive effect as a result of the advancement of technology has gone to bad banks. It has not created more jobs, but less. The second biggest structural problem is to large governments. How can a productive economy be competitive and at the same time share have the benefits of that productivity with a completely unproductive appendix. The third structural problem is an intertwined fraudulent global banking system that is insolvent and remains to be insolvent. Banking is business if you do not do it properly you fail, that happens in every business. What surprises me the most in this too big to fail discussion is this. Banks are masters of the market; they play the game best and with the highest stakes. Why on earth are banks even regulated? Do we regulate poker players? Do we feel sorry for the idiot who loses his car and house in a game of Poker? Let the banks be regulated by the rules of their own game. You place a bad bet you lose and are out. There that is all regulation needed for banks. If you lose you pay up or Uncle Mickey is going to get medieval on your knee caps. The fourth structural problem is to high rate of helplessness as a result of government stimulation to become helpless. Excuses are handed on a platter to become government benefit receiver. Not just in the USA, but in the entire devolved world. I have nothing against helping people, but this really is one fucked up example of the cliché the road to hell is paved with good intentions. The worst of it all is not that you just make a big group of people dependent, far bigger than is ultimately necessary. Never in the history of mankind has there been a society with so many helpless people as we have today. There is only one reason it is deliberately stimulated. The worst side effect of this is that you destroy creativity in doing so. Who knows how many genius ideas, inventions and innovations have been destroyed by this stimulation program. Nobody knows, but given our progress compared to progress we made two centuries ago it is safe to say that we allow creativity and therefore future potential to die if we continue down this road.

With a systemic crash, politicians receive their excuse to get rid of liabilities that are the result of promises that should never have been made in the first place solving structural problem 4. It will also force government to radically shrink instantly solving structural problem 2. This will lead to deregulation and decentralisation on many local levels great that helps to counter balance powers that want more centralization the number one structural problem. The cleansing of the global banking system as a result of the crash, will take all the bad banks and bad loans and bad assets out of circulation allowing the clean sheet. Nothing except a systemic crash can tackle the structural problems. No president, no central banker no QE no amount of debt created can solve it, the only thing that can really allow for change to come to pass is a gigantic burst of the enormous Keynesian bubble blotting out the moon and the sun for mankind.

If all the idiots had just allowed it to happen after the dot.com burst we would not have been in this ridiculous situation we are in now. This is just plain stupid how on earth are we going to face ourselves in the mirror and explain this embarrassment to future generations. Really, give the kids a break and allow this system to crash. Thanks you only lose fiat money actually all you lose is debt and that is the purpose of all policy makers if I listen into mainstream Media where they voice their opinions.

 

 

Tue, 10/02/2012 - 12:40 | 2848729 perelmanfan
perelmanfan's picture

 

 

Tue, 10/02/2012 - 12:40 | 2848730 perelmanfan
perelmanfan's picture

Excellent comment, Fort. Life should be getting better based on tech-driven productivity gains, but those gains are being sucked away by govt. and banks before they can benefit people at large. Romney is a moron, but a national dialogue about "makers and takers" would do this country a great deal of good. Far too few Americans think hard about the distinction between enterprises that make and those that merely take; consequently, we've wound up with far too much of the latter.

 

Tue, 10/02/2012 - 13:47 | 2848998 steve from virginia
steve from virginia's picture

 

 

Nice comment ... however, paragraphs are helpful!

 

Clean up the mess and let's return to the old normal

 

The old normal included a trillion barrels of petroleum we no longer have. What's left? Barrels that are too expensive to waste. Ours is a waste-based economy that monetizes capital destruction. This is a normal we cannot afford any more, it's never going to return ...

 

... no improvement (by way of productivity) has trickled down to household disposable income. Why not? I mean if the invention of the car had such an impact why on earth PC and internet didn’t have a similar impact.

 

Household disposable incomes are borrowed just like all other earnings, the difference between workers and bosses is the bosses multiply their earnings by way of leverage, householders generally cannot (unless there is a housing 'bubble'). BTW, the PC and Internet have had impacts: increasing management productivity = pillaged household disposable income. The car has pillaged the public sector of disposable income (see 'Defense Department')

 

How can a productive economy be competitive and at the same time share have the benefits of that productivity with a completely unproductive appendix.

 

Your presumption is false: economies are not productive. They cannot pay for themselves but must borrow their earnings. Industrial economies are debt-dependent which is why the finance system is kept from ruin at all cost. No debt = no industry. Evidence for this is the existence of massive debts in the first place: if industry was productive it would retire its own debts, more industry would retire all debts. Now: adding more industry requires more debts be taken on. At the same time, debt has become too expensive to afford + increased cost of inputs/capital.

 

This is thermodynamics, BTW.

 

Our crisis is a shortage of capital. Where did it go? Simple, we burned it up for nothing in return. What is the collateral for the hundreds of trillion$ of debt taken on? A bunch of used cars and smog.

 

Never in the history of mankind has there been a society with so many helpless people as we have today.

 

This is the consequence of overpopulation + labor productivity/energy waste. These excess people have nothing to sell but their willingness to behave themselves for a fee. See 'Jamie Dimon'.

 

With a systemic crash ...

 

... there are no jobs, no functioning businesses because they require a flow of credit, no 'good money', no food in the grocery stores, interrupted running water, blackouts, hospitals without supplies, no services, gangs in the streets, sharply diminished numbers of cars and fuel shortages ... this is Greece and Spain right now. Europe is experiencing a systemic crash. This is coming to a country near you. There are no benefits to it, no possibility of recovery, only a steady descent into anarchy. It is the self-immolation of modernity. The money-managers know this which is why every effort is made to prop up finance. 

 

Why the systemic crash? The system is needed to provide the fuel, cheap fuel is needed to operate the system. Fuel is too expensive for an economy built specifically to monetize waste. The user infrastructure is stranded by high fuel costs.

 

The US won't completely collapse -- it has some fuel remaining -- but it cannot afford to waste any more ... period. Modernity = kaput.

Tue, 10/02/2012 - 12:13 | 2848615 Clowns on Acid
Clowns on Acid's picture

The Fed is mispricing capital ? No way !

The VXX is @ 9, I guess I 'll be a buyer at 4. Can only lose the 4 right?

Well, then again, maybe the VXX can go negative.....when BenDover announces QE2 . Fed announces the buying of Equity Index. Unrealistic ?

Tue, 10/02/2012 - 12:13 | 2848616 Bicycle Repairman
Bicycle Repairman's picture

I guess I'll put old Sam in with the liquidationists.  Can't he wait until the banks create some large recession-priced RE blocs made available only to large investors such as himself?

Tue, 10/02/2012 - 12:49 | 2848772 YouAreBliss
YouAreBliss's picture

He's worth Billions - and wants to shove little old ladies out of their crappy mobile homes so he can make another buck.  Nice guy.

If you cut him open  - I bet there would be no blood.  Fucking Vampire - like Romney.

From Wiki:

 

"Zell's company Equity LifeStyle Properties, the largest mobile-home landlord in the United States, has been criticized for working to eliminate rent-control laws in local municipalities so that they can raise rents on their tenants to market rates."

 

Tue, 10/02/2012 - 12:33 | 2848703 WhiteNight123129
WhiteNight123129's picture

101 for everyone.

THe world is a zero sum game. It is . The only exception is science enabling us to use resources in a better way. Without technology, Sam Zell would have been the leader of a large sheep herd by screwing some other shepperd and he would have said. "I succeeded because I was smarter". Sam Zell saw interest rates to the roof bringing real estate down to ashes. He is driven but it is a zero sum game.

And right now the FEd is frying capital owners. Tahnk you Ben from the Bottom of my heart.

 

 

Tue, 10/02/2012 - 12:36 | 2848715 chrisd
chrisd's picture

Classic mistake of letting his politics get in the way of making money. His tribune deal worked great!!

Tue, 10/02/2012 - 12:46 | 2848753 YouAreBliss
YouAreBliss's picture

Class Warfare?  Are you fucking kidding me  - this guy would be upside down if it weren't for TARP and other $23 Trillion in dozens of Fed/Treas 1% WELFARE/BAILOUTs and backstops.  Who do you think benefits the most by 0% interest money, CMB Fed/Treas rollover financing, CP backstops, etc...  Not the family about to be evicted after 24 months of no mortgage payments, they're just trying to survive.

Another lunatic GOP/Teaparty, .0001%, delusional, egotistical, self-important clown.  Like "The Donald" - who would be also BK if not for his banker's forgiveness many times.

This is what makes up America's Autocrats, our LORDS, PRINCES, DUKES, COUNTS, and BARONS.

I bet they thought themselves vastly superior to everyone else - until the revolution.

 

This is why Romney is going to lose big - he thinks just like him (unfortunately so does Obama and most Dems, they just spin differently).

Oh, for the Zell fans out there - he's a big buddy to old Rod B., that prince of a guy.

From Wiki:

"Zell was implicated in the corruption charges against former Illinois Governor Rod Blagojevich. The charges claimed that Blagojevich had pressured Zell to fire particular Tribune editorial staffers, known to be harshly critical of the governor, in exchange for tax breaks on the sale of Wrigley Field. An aide to Blagojevich reported back to the governor that Zell "got the message and is very sensitive to the issue." The District Attorney's office later concluded that the aide had not in fact approached Zell and was lying to the governor.["


 

Tue, 10/02/2012 - 13:00 | 2848826 steve from virginia
steve from virginia's picture

 

The 'Human Hairball' avoided bankruptcy b/c his dad Fred bailed him out more than once.

 

Friedrich Drumpf was the brains in the family and built the Trump fortune. Fred developed hundreds of the Soviet-style high-rise apartments all over the city. Donald is a hairpiece in search of a cat to have sex with ....

Tue, 10/02/2012 - 12:54 | 2848801 steve from virginia
steve from virginia's picture

 

Zell would look GREAT slumped over his desk with a self-inflicted bullet wound to the head, a small caliber auto in his hand ...

 

That 'Class warfare crap' ... it hasn't started yet, the 'other' classes have not begun to fight. Once they do they will hang onto their money tightly and never let it go ... the Sam Zells won't get another penny. Since Zell and his compadres are trillions in debt ... and need to convert their debts into circulating money ... they are destroyed when the flow of funds is cut off, just like they almost were in the early 1930s.

 

Yea, hoard, Baby, hoard! Buy gold and silver, hide it away and let the Zells and the Dimons and the Fords and Rockefellers and Gates and Kochs die ... die horribly, ruined! Starve them, deny them their finance sustenance. They will kill themselves out of despair ...

 

 

Tue, 10/02/2012 - 14:16 | 2848892 YouAreBliss
YouAreBliss's picture

Steve from Virginia - another great comment!

They fed off free and easy leverage - how would you like to be able to borrow a Billion at 0% interest rates no collateral - then have your "buddies" at the Fed/Treas tip you off months in advance, as to were the next "bull market" will be.

Quick way to make millions.

Tue, 10/02/2012 - 13:28 | 2848926 linrom
linrom's picture

Reading Steve's comments is always a pleasue.

Tue, 10/02/2012 - 13:28 | 2848921 linrom
linrom's picture

Sam Zell is Michael Hudson's poster boy of what capitalists should not be: FIRE sector destroying industrial capitalism and forcing debt peonage on society, which 18-19th century classical economists referred to as the 'real class warfare' by rent seekers.

In this interview, the first thing that Zell mentions is lack of opportunities for capital to earn a return!

Government sponsored welfare programs are ways to deal with private sector's failure to create jobs as capitalists are not interested in earning  profits by employing 'someone'. They seek returns on capital employed in financial sector.

 

Tue, 10/02/2012 - 13:49 | 2849021 DR
DR's picture

"the game is being stacked against me"

 

Since when did the billionare class become such whinners?

 

http://ftalphaville.ft.com/blog/2012/10/01/1186271/hedgie-billionaires-w...

 

Zell and company should just STFU!

Tue, 10/02/2012 - 14:19 | 2849109 YouAreBliss
YouAreBliss's picture

They are like the rapist - who asks "was't it good for you too?".

Tue, 10/02/2012 - 16:23 | 2849580 jstrack
jstrack's picture

Linrom, do you have any idea about the balls it takes to hire people and start a business or build anything?  You talk about capitalists like a predjudiced bigot.  Where does the money come from for the welfare checks?  It ultimately comes from capitalists who build businesses and employ people.  Governent and welfare people need business to be successful for their success.  Oh brother...

Tue, 10/02/2012 - 13:46 | 2849010 Young
Young's picture

The man is a speaker of truth! I only disagree with one thing from the last clip - why wouldn't you want to put your finger in a dyke!?

Tue, 10/02/2012 - 14:18 | 2849108 YouAreBliss
YouAreBliss's picture

why wouldn't you want to put your finger in a dyke!?

Answer: Because he already has them up his ass.

Tue, 10/02/2012 - 14:48 | 2849199 blunderdog
blunderdog's picture

She might be offended?

Tue, 10/02/2012 - 15:00 | 2849257 MoneyShaman
MoneyShaman's picture

Fairly vague.

Tue, 10/02/2012 - 15:51 | 2849479 jstrack
jstrack's picture

Sam Zell is a legend in Chicago and is a person to be listened to.  Today he talked softly and firmly about what he believes and his message i hope is listened too.  

A few years back I sold everything I had in the Chicago area and built a hotel in another country because I saw that everything is massively over priced.  I may have made a mistake, but I think we have yet to hit the bottom.  So I will ride it out somewhere else.  In time I will sell what I have built and will move back to the states should taxes remain reasonable and the country does not go too far to the left.  So that's my advice for someone like me, which is what I did.  

In any case I am a former MAI appraiser and Sam still owes me...LOL  

Take a risk with small downside and big upside and live or get a heart attack trying...  Life is too fucking short to accept being a victim or pawn any more than you have too...

 

 

 

 

Tue, 10/02/2012 - 17:50 | 2849851 TheObsoleteMan
TheObsoleteMan's picture

While I agree with SOME of what Zell says, bottom line he is still a crony capitalist and Keynesian at heart.

 

 

 

 

 

 

 

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