Market Conditions will make us stronger Says Fuller's Greg Morris

BrokerIPTV: Today we are talking with Greg Morris, CEO of Fuller & Company Commercial Real Estate. Greg, welcome back. Love to have you.

Greg Morris: Thanks Dan.

BrokerIPTV: We were joking on the phone that you know you always keep up with everything, you are right on top of it. You are a news guy and you on vacation in September and we have the worst credit crisis beginning[Phonetic] maybe 50 years. That had to be incredibly frustrating for someone like you.

Greg Morris: I would like to take full responsibility for the crash [laughter] [Voice Cross Over] it was interesting to watch it from afar.

BrokerIPTV: Your thoughts on the turmoil that we have seen in the last month?

Greg Morris: Well, I think you know, what we are seeing is a deleveraging at every level within the economy; on a personal level, you are going to see people with lot less debt, more savings; at a corporate level, lot less leverage and I think that's going to be a healthy thing frankly. If we look back at what has happened, we frankly were too leveraged and we were anticipating and planning on too much growth that at some point was going to stop and that's what we saw.

BrokerIPTV: How about the response? Were you a guy that was in favor of this bail out?

Greg Morris: I think to answer that question, you have to look at what the alternatives were. I mean there were not very many alternatives and if you compare what we are seeing today to the great depression of the 1930s, what happened back then of course we did not have the FDIC, so you didn't have a safety net; #2 and most importantly, you didn't have any liquidity put into the marketplace and as comparison now we are going to see now 700 billion dollars of liquidity put into the system and that's going to be healthy and one thing I think people have to remember is that 700 billion dollars relative to a 14 trillion dollar economy is only about 5%. So, it's significant, but it is not going to end the world.

BrokerIPTV: I stopped watching the market on a daily basis for obvious reasons and stress level because you are watching one day you are down 500, you are up 600, you are down 200, you are up a 100. Your take on what's going on there?

Greg Morris: Oh, I think it's right back to what I originally said about the deleveraging and taking stock prices from where they were which were probably unrealistic. These companies frankly were not worth what they were trading at and now the sell off has brought it down to a more realistic level. One interesting fact that we need to take a look at is I think a positive sign is, let's take IBM for example, their stock has dropped 25% in the last 60-90 days. Does that mean they are 25% less of a company? The answer is no and so what you are seeing now these big US large cap companies buying your stock back where they are saying, "Hey, this is a value. Our company did not devalue by this much. It is just being pulled down by the tide of the rest of the market."

BrokerIPTV: All right. So, the average citizen is saying how long is this going to take to recover? What is it going to take for things to kind of stabilize and level off and your answer would be...?

Greg Morris: If I had the answer to that I would not be...

BrokerIPTV: [laughs]

Greg Morris: Sitting here with you right now.

BrokerIPTV: Right. How about an opinion?

Greg Morris: Well, my opinion is we are going to need confidence built back into the system, both at a consumer level and a global level and that's just going to take time. I think the things that the federal government are doing right now with the liquidity they are adding and some of the fundamentals we are seeing moving forward are positive, I think we are going to see a lot more regulation in the system which is probably not a bad thing. We probably got away from regulating some of these financial institutions and so, it is going to take some time, but if you want a spot answer from me, I think a year from now we are going to be going on and things are going to be much better; I think in 2010 we will be fully out of this thing.

BrokerIPTV: That's what I like to hear.

Greg Morris: All right.

BrokerIPTV: Thank you. Appreciate it.

Greg Morris: Sure.

Posted on October 31, 2008 10:56:01 by Blog Author