Starwood Chairman, Barry Sternlicht, on Squawk Box (lowest rated morning cable show), said that all his money manager friends were "ready to sell" at any minute because of the Fed's bond buying, which he says is creating asset bubbles.
My first response is why should we care that his money manager friends are waiting to sell? Given the notoriously bad track record of professional money managers (90% can't beat the market averages and the other 10% are trading off inside information or rigging trades) should their desire to sell really make us worried? Maybe it's better to ask, isn't that a good sign?
As far as the "asset bubble" thing all I can say is this: Sternlicht may know something about real estate and the hospitality business, but it's clear he doesn't know jack shit about monetary policy.
On the one hand he says that the Fed's bond buying is "creating asset bubbles," then he goes on to contradict himself by saying there's "all this cash sitting on the sidelines."
Well, if there's all this cash sitting on the sidelines, Barry, then how the fuck is the Fed creating asset bubbles?
It also doesn't occur to real estate expert Sternlicht, that four years of sub average housing starts means means that the nation's housing stock has shrunk and is dilapidated. This means prices will rise to "replacement cost" and that could be pricey given supply the shrinking/substandard supply.
Meanwhile, clueless Joe CLOWN Kernan sits there eating it all up.
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