Investment guru Sam Zell offers an “incomplete” grade for President Donald Trump after his first six months in office.
“He’s learning on the job,” Zell explained to Barron’s.
“They all do, but most of them came from a political environment. In politics, you are very sensitive about hiring and firing. In the business world, and particularly for him, firing people was a daily occurrence,” the Equity Group Investments Chairman said.
“He should stop tweeting. Never pick a fight with somebody who buys ink by the barrel. Not that I’m a great fan of the press, but I can’t imagine there’s a long-term positive in taking on the people whose job it is to cover you. The strength of our society is predicated on respect for his office. That’s missing right now,” Zell said.
However, Zell predicts that Trump is on a better path than the previous administration.
“In his first year, President Barack Obama spent a trillion dollars on a stimulus bill, which achieved nothing other than almost a trillion dollars of debt that is now worth more than that. Trump has a unique opportunity to create stimulus by deregulation. He has already rolled back the rule about navigable waters [which extended the reach of federal water regulations],” Zell said.
“One change that would help small businesses is to modify Dodd-Frank, reduce the unrealistic compliance costs for small banks, so that lending is more readily available. Another is to roll back excessive environmental legislation. I worry about too much capacity. If you double the size of the Environmental Protection Agency, you then have a whole bunch of people thinking up new regulations to keep busy,” he said.
Zell said that another Democratic administration would have led to a recession. “Trump’s election gave us extra innings because there’s more optimism in the business sector. Smaller businesses were basically destroyed by the Obama administration. Compliance was a giant animal that gobbled up everything. However, this recovery began in 2009. There aren’t many examples of 10-year recoveries in U.S. history,” Zell said.
As for the current stock market, Zell doesn’t see it as a reflection of the whole. “It reflects a few companies that dominate: Amazon.com [AMZN] at 150 times earnings, instead of XYZ regular company at six times," he said.
Meanwhile, another business icon recently gave Trump a much higher early grade.
Anthony Puzder, the former chief executive of CKE Restaurants who was President Donald Trump’s first pick for U.S. labor secretary, said the new administration is having many positive effects on the economy.
The most important indicator is the rise in household income, which gained more in the first three months of the Trump presidency than during the entire seven and a half years of the Obama recovery. Median household income has surged $1,300 since the beginning of the year to $59,361, compared with a $1,000 gain during the Obama years.
“President Trump’s focus on reining in the administrative state has significantly reduced both the number of existing regulations and the output of new regulations, driving business optimism,” Puzder said in an opinion piece for The Hill. “Unlike policies that increase the oppressiveness of government, policies that incentivize business growth (like deregulation) produce jobs, opportunity and prosperity.”
(Newsmax wire services contributed to this report).
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