Monday, April 28, 2008

Mr. Nice Guy Speaks, Again.

Zell urges "cleansing," not sympathy, on housing

by Peter Viles, The Los Angeles Times
Photo: Charles Rex Arbogast / AP

Jy3t8jncI now understand Sam Zell's strategy to revive newspapers: He's going to provide all the content himself. Here's Zell's analysis of the housing market today, filed by Tom Petruno on his Money & Co. blog:

"What this country needs is a cleansing" in the residential market, Zell said. "We need to clear out all of those people who should never have been in houses in the first place and who for sure shouldn't be getting sympathy."

He blamed another Sam -- Uncle in Washington -- for encouraging homeownership at any cost in recent years. The rise in the U.S. homeownership rate from 63% to 69% during the boom was totally unjustified, Zell said, other than by "the political impetus of, 'Let's put more people into homes they can't afford."


This is the same guy that bought the Tribune company with very little of his own money. In other words, he put very little down while utilizing creative financing to get the deal done. Now Sam's having trouble making the loan payments. Isn't this the same buying method that started the current housing crisis in the first place?

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