Banks 'Virtually Laughing' at Loan Seekers: Trump
There are no signs that the real economy is improving and banks are still not lending despite the huge amounts they received from the government, legendary real-estate investor Donald Trump told CNBC Wednesday.
Banks received "billions and billions" of dollars and this made them solvent, and some want to pay it back sooner, but they should lend to boost the economy, according to Trump.
"The banks are not lending money, there's no money out there, no matter how strong you are, no matter how good your deal is, if you go to a bank today they virtually laugh at you if you're asking for money. They don't have money or they're hoarding money," he said.
"The policy makers have to make the banks loan the money that they're giving to the banks. I don't know what they do with the money but they don't have any money to lend," he added.
Analysts have repeatedly said that banks may be using the cash they get to cover holes in their balance sheets caused by toxic assets.
"It's going to be very interesting what the toxic assets will sell for... if they sell," he said.
Trump also said he was buying commercial real estate, but admitted that there were clouds of uncertainty hanging above the sector.
"I'm a buyer of commercial real estate," Trump said. "The only problem with buying is you just don't know how low is low. The only positive I see frankly is that the stock market is going up but I just don't know why the stock market is going up."
But there are risks in commercial real estate as, "unless you signed leases 2 years ago you're going to have trouble renting space or you'll rent it very low," he said.