Zell Sees Start of Housing Recovery in the Spring

[GaryC 7]

The US economy will avoid recession as the housing market begins to recover this spring, according to billionaire investor Sam Zell.

Speaking on "Squawk Box" this morning, Zell attributed much of the current economic troubles to fear-mongering and politicking by Democratic presidential contenders Hillary Rodham Clinton and Barack Obama.

"Obviously what we have going on is an attempt to create a self-fulfilling prophecy," said Zell, chairman of Equity Investments Group and owner of the Chicago Cubs, Chicago Tribune, Los Angeles Times and other companies. "We have two Democratic candidates who are vying with each other to describe the economic situation worse.

"The reality is that if you live on Wall Street and you're in the credit markets the world couldn't be worse. If you're a farmer and you're getting $25 for your wheat, you're having a great time. If you're a CEO and you've got a balance sheet that's bullet-proof, you're in a great position. This whole thing is way out of control, way out of hand."

Zell said that although he doesn't try to pick bottoms in markets he believes housing has hit its nadir and will turn around this spring as inventory clears out.

As for the credit situation, he projected that once markdowns are out of the way banks will begin to regain their footing.

In the wide-ranging interview, Zell also voiced support for Federal Reserve Chairman Ben Bernanke.

"I think he should be renewed when his term is up. I think one of the positives of the United States is having people in the position of the Federal Reserve (chairman) for long periods of time," Zell said.

"I think Bernanke's reduction in interest rates has been spot-on, because basically we're going to fix the credit markets by creating a big enough spread between the risk-free cost of capital and what's available so that greed overtakes fear and the game begins again."

http://www.cnbc.com/id/23350846/site/14081545

[Sofargone 2]

Isnt this the same tard who bought the Cubs and is now going to sell the naming rights to Wrigley Field ???

What a quack !

Sofargone

[Mr. Big Dog 10,747]

Yeah they were talking about the decline in home sales actually slowing to an insignificant rate recently. I just had half an ear for the story on the morning news but I think they were saying that it appears the housing market correction has just about bottomed out. At least around here.

[GaryC 7]

Yeah they were talking about the decline in home sales actually slowing to an insignificant rate recently. I just had half an ear for the story on the morning news but I think they were saying that it appears the housing market correction has just about bottomed out. At least around here.

We are closing on our home friday. I was talking to my realitor today and he said that things are starting to pick back up. The reduction in the interest rates is having an effect. It looks like I timed my buy just right.

[Dan J 277]

Yeah they were talking about the decline in home sales actually slowing to an insignificant rate recently. I just had half an ear for the story on the morning news but I think they were saying that it appears the housing market correction has just about bottomed out. At least around here.

We are closing on our home friday. I was talking to my realitor today and he said that things are starting to pick back up. The reduction in the interest rates is having an effect. It looks like I timed my buy just right.

But your area was relatively unaffected by the spike and then decline in prices. Go to any significant metro area and you will see a different story.

[Mr. Big Dog 10,747]

Yeah they were talking about the decline in home sales actually slowing to an insignificant rate recently. I just had half an ear for the story on the morning news but I think they were saying that it appears the housing market correction has just about bottomed out. At least around here.

We are closing on our home friday. I was talking to my realitor today and he said that things are starting to pick back up. The reduction in the interest rates is having an effect. It looks like I timed my buy just right.

It sure looks that way. Good for you. If this is the bottom of the correction, we came out alright too.

[one...two...tree 2,762]

[Ban Hammer 13,342]

cali looks a bit warm....

[one...two...tree 2,762]

cali looks a bit warm....

Yep.

[GaryC 7]

cali looks a bit warm....

The speculation got out of hand. The prices in those areas got driven up so high that it could not be sustained. Add to it the totally stupid financing that was going on and there is little doubt as to the outcome.

[w¡n9Nµ7 §£@¥€r 123]

During the last RE downturn in the northern/central NJ area (NYC commutable), nominal prices declined for about 3 years before hitting bottom. The total decrease in average nominal prices was 10-15% over that period. Nominal prices then stagnated (i.e. inflation-adjusted values continued to decrease) for another 7 years. Anyone who bought in 1988 broke even (nominally, not taking into account inflation) in 1998.

In my town, prices peaked in the fall of 2005 (not 2006 like so many places). I'm hoping we're near the end. What was 375 is now down to about 335. I'm expecting a further decrease down to 315-320 this summer (this January was the slowest January in terms of sales in over a decade out here). Near the bottom? Maybe in some places. Not here. Not yet.

Edited February 28, 2008 by VJ Troll