Donald Trump On Commercial Real Estate

Ø      If  all the bank loans were paid up, no one would have a bank depo­sit, and there would not be a dol­lar of cur­rency or coin in cir­cu­la­tion. This is a stag­ger­ing thought. We are com­pletely depen­dent on the com­mer­cial banks for our money. Someone has to bor­row every dol­lar we have in cir­cu­la­tion, cash or cre­dit. If the banks create ample syn­the­tic money, we are pro­s­per­ous; if not, we starve. We are abso­lutely with­out a per­manent mone­tary sys­tem.  When one gets a com­plete grasp upon the pic­ture, the tra­gic absur­dity of our hope­less posi­tion is almost in­cred­ible – but there it is.  It (the bank­ing prob­lem) is the most im­por­tant sub­ject in­tel­li­gent per­sons can in­ves­ti­gate and reflect upon. It is so im­por­tant that our pre­sent civi­li­za­tion may col­lapse un­less it is widely under­stood and the defects reme­died very soon. – Robert H. Hem­phill, Cre­dit Mana­ger of the Federal Reserve Bank of At­lanta

Trump’s words of advice are if you have the money, this is a great time to buy a home or condo. Home prices are low but they are rising, which means great things for the housing market.
As for commercial real estate, Trump believes that the government needs to step in and tell banks to loosen up on their standards for people looking to build commercially. Without more commercial business development, the economy will remain stagnant. Without growth, new jobs won’t be created, which will further inhibit the job market.
While Trump has some solid points in his remarks., you have to think about the Bank’s point of view. Due to the recent recession, many of the Banks are still living in fear of what might happen again. Since Commercial Real Estate is giving Banks the shakes, many of the Banks are reluctant  to lend…and the Regulators are being exceptionally tough on lending standards.
What do you think? Are the Banks being too cautious? Do we need more Government intervention?
I suspect that a good percentage of very successful Developers would NOT be approved for loans today.
I welcome your opinions…..America’s Real Estate for the most part has been built on a risk-reward basis. ( Credit To Home Space)
Enjoy Your Day!