Billionaire investor Sam Zell warns US faces ‘serious problems’ if Fed doesn’t hike rates by 100-basis points
Billionaire real estate investor Sam Zell: Inflation ‘creating hole’ in housing market
Equity Group Investments Chairman and founder Sam Zell argues he doesn’t see many signs that there will be a reduction in inflation in the near future.
Equity Group Investments Chairman and founder Sam Zell warned that the U.S. economy could face "serious problems" if the Fed doesn’t hike rates by 100-basis points within the next year.
"The Fed has missed the opportunity to be the disciplinarian that it should be. We have to dramatically reduce the liquidity available in the market," Zell told Maria Bartiromo on "Mornings with Maria" Thursday.
His comments come as the Federal Reserve raised interest rates by 50-basis points Wednesday following a highly-anticipated Federal Open Market Committee meeting, the biggest move in over 20 years.
Federal Reserve Chairman Jerome Powell also made comments about a possible recession and killing the idea of a 75-basis point hike in the near future during his press conference.
FED RAISES INTEREST RATES BY A HALF POINT FOR FIRST TIME IN 20 YEARS AS IT RATCHETS UP INFLATION FIGHT
"The labor market is extremely tight and inflation is much too high… the FOMC raised its policy interest rate by a half percentage point," Powell remarked Wednesday.
"It's a strong economy, and nothing about it suggests that it's close to or vulnerable to a recession. 75-basis points increase is not something the committee is actively considering."
Billionaire real estate investor: Inflation ‘creating hole’ in housing market
Equity Group Investments Chairman and founder Sam Zell provides insight into how inflation is impacting the housing market and U.S. economy.
Zell said that the Fed needs to "reduce liquidity" and "stop sloshing around all that extra capital."
"I think that the fact that the Fed has spent so much time not doing what it should have been doing, creates a big gap that I think can be filled without much damage," Zell explained.
FED'S POWELL CALMS RECESSION JITTERS WITH REBUFF OF 75-BASIS POINT RATE HIKE
"100-basis points, even 200-basis points over the next year is not likely to put us into a recession. It's just probably likely to bring us back to where we should be."
He went on to say the Fed’s move may not be enough to slow the inflation rate as the U.S. economy continues to reel from high consumer prices.