Is a mild recession looming on the horizon?
Billionaire real-estate investor Sam Zell warns the economy is ‘in the ninth inning,’ but predicts a ‘milder’ downturn ahead, according to a recent WSJ article. Mr. Zell, who correctly called the top of the last commercial real-estate cycle, predicts that global problems will likely push the U.S. into a recession next year. He contends the U.S. is not immune to problems in the world economy, including low oil prices, falling import demand from emerging economies, volatile financial markets, deflation, possible negative interest rates and currency exchange rate fluctuations, according to the WSJ article written by Janet Morrissey.
“I’m not being pessimistic, I’m being realistic,” he said.
When the recession does hit, Mr. Zell believes it will be a “significantly milder version” than the previous one. In the real estate world, he noted, companies have far less leverage today than in 2007, making it easier for them to weather the downturn.
In 2007, Mr. Zell famously sold his Equity Office Properties Trust in a $39 billion deal just before the market crashed. He also made a fortune buying discounted assets in the wake of the recession of the early 1990s, a strategy that earned him the nickname of the “grave dancer.”
Read the entire WSJ article here: Sam Zell Global Woes (subscription needed)