This past Monday, on CNBC TV (the financial channel), Sam Zell was interviewed. He is a Billionaire Real Estate Mogul who, among his other holdings, owns the Tribune News Group. He was complaining about President Barack Obama, stating that the Country needs a politician who will unleash “small businessmen like him” to move the Economy forward. How many times have we heard the Small Businessman comment when, in Mr. Zell’s case, he has a reported Net Worth of $4.9 Billion?
Just after President Barack Obama took the Oval Office, the World stock markets bottomed in March of 2009. Since then, the Dow Jones Industrial Average rose from just under 6,500 to where it closed today, at 13,575. That’s better than a 100% Recovery. Besides his real estate empire and other holdings, Zell is also the Chairman of of the Equity Investment Group. So, I assume that he benefitted from the very significant run-up in the Stock Market. Just like the rest of The Billionaire Club.
Besides the Stock Market tanking in late 2008, the Bond Market basically froze-up during the October 2008-March 2009 period. Corporations and Real Estate Developers are especially reliant on a functioning Bond Market for short-term and other financing. That is why General Electric and Goldman Sachs each borrowed $5 Billion from Warren Buffet’s Berkshire Hathaway, and paid a ten percent interest rate on Preferred Shares. Generally, two such high quality corporations, which were assumably creditworthy, would have paid a much lower rate of interest for short-term loans.
So, once again, the Billionaires are out for “Me, Me, Me!” Surely, they don’t have to worry about a pink slip or their home being foreclosed on. It merely looks like, if they don’t own all of the toys and assets on Earth, they are simply not happy.