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

"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