Billionaire investor Sam Zell questioned Tesla's valuation and Bitcoin's worth, predicted many workers will return to offices, and warned the US dollar could cease to be the world's reserve currency in the next decade during a Real Vision interview filmed on December 7 and released on Friday.
The founder and chairman of Equity Group Investments - who made his fortune buying up properties at discount prices in the 1970s, then cashing out just before the commercial real-estate market collapsed in 2008 - also underscored the need for dogged self-belief to succeed in life.
Here are Zell's 15 best quotes from the interview, lightly edited and condensed for clarity:
1. "If you don't know that you can't, then almost anything is doable."
2. "I didn't know that a young kid at the University of Michigan couldn't start a big real-estate company. I didn't know that I couldn't buy buildings. I didn't know that I couldn't rehab them. I didn't know that I couldn't sell them. Because nobody ever told me that I couldn't. Everybody looked at what I did and said, 'That's crazy.'"
3. "I figured out that if nobody in the world agrees with me - if we are right, we get pretty serious margins."
4. "My favorite 11th commandment is, 'Thou shalt not take oneself seriously.' You need to constantly challenge your own thoughts."
5. "Open competition is a destruction of capital. In all of my investments, I have always been oriented toward barriers to entry. How do I protect myself from the insanity of others?"
6. "We can look at some parts of the stock market today and say, 'Everybody is crazy.' I look at valuations and see extraordinary numbers that I can't support."
7. "If you move to Nowhere, Iowa, it's five o'clock there every day. And what do you do at five o'clock? Go across the street to the pig farm? We are social animals." - arguing that a mass exodus from cities isn't realistic.
8. "All these people who today are thinking this is the end of office space and everybody's going to work from home. I don't know how to motivate by modem. " - Emphasizing that urban centers have weathered financial crises, pandemics, and other disasters in the past.
9. "Everybody's going to do Zoom calls. And then one day, a young whippersnapper is going to say, 'You know, I think I've got a better chance if I go sit in front of the guy.' And so he's going to get on a plane. And he's going to sit in front of the guy. And he's going to get the deal."
10. "I can't even begin to give you an intelligent assessment of Tesla. It makes Cisco look cheap." - Pointing out that Tesla barely makes any money despite absorbing billions of dollars in investment, and comparing it to Cisco, which was valued at 125 times earnings in 1997 - a price tag implying it was responsible for an absurd 25% of the US business environment.
11. "Everybody else seems to have a kind of timing game in their own head. 'Well, I can get out before so and so happens.' The world is full of skeletons of people who believed they could get out before the bad event came."
12. "Supposedly, if your index fund matches the market, you've succeeded. But if that market is going down like an elevator, I am not sure that's much success."
13. "The single greatest risk that we are dealing with today is the loss of the US dollar as the reserve currency. If we keep doing what we are doing right now, I think it is 10 or 15 years away. If we lose the reserve status, I could see a 25% reduction in our standard of living."
14. "Unlimited debt and irresponsible activity don't lead to positive outcomes. That's a disastrous kind of scenario."
15. "I am very skeptical, frankly, of Bitcoin. Ultimately, it may be the answer or one of the answers. But right now, it's a world that's extraordinarily populated by chameleons and other fast-talking characters. I don't believe everybody involved in it are the kind of people I'd like to follow. "
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