The U.S. is likely to have gone into a recession in the last couple of weeks, Sam Zell, chairman of private investment firm Equity Group Investments, told CNBC.
“[It’s a] result of all of the angst and panic that has been going on,” Zell said. “It basically means that everybody pulls back. If everyone’s watching the stock market, then they are not making any transactions.”
However, Zell expressed optimism about interest rate cuts out of several of the world's central banks Wednesday, saying the world has been waiting for a coordinated rate cut response and that the Federal Reserve's move was a “very positive event.”
(Watch the accompanying video for the full interview with Zell...)
“This is a reflection of the fact that no country in the world views this as an opportunity to take advantage of the currency swings that may come from lower interest rates,” he said.
In terms of the housing market, Zell said commercial real estate market is doing “dramatically better” than the residential market.
Zell added that mark-to-market accounting rules have grievously worsened Wall Street's current turmoil.
“Mark-to-market accounting has had a massive impact on markets. Only in the last few months have we actually seen stories about it. Nothing dramatic has improved. Even the bailout bill has wishy-washy language about trying to reduce the marks," Zell said. "And the idea of marking all of your assets to fire-sale pricing just challenges credibility.”