"If the Obama Administration is moving to reinstate Glass-Steagall, that's a good thing. It would allow imprudent risk disease to be limited to investment banks, rather than commercial banks, in which there is public trust and government support already. If investment banks have a problem, they should take it on the chin. They're big boys. But when commercial banks have a problem, we take it on the chin. And that's not right. So Glass-Steagall's reenactment is absolutely correct.

If they return to the more traditional bank model, the next logical step is to no longer have this nonsense of no mark to market. When you no longer mark to market, what you're saying is you no longer have to be candid and truthful about the quality of your assets. Now if you use those words, who would say that's a good idea? Nobody.

Marking to market is the way we have always insisted our banks look at values on their balance street. If you mark your real estate to market, there is no point in holding it. You'll sell it. The bank will sell it at a value that reflects the reality of the market. Real estate buyers will come in; they will descend on this market. I assure you that all over the world people are waiting to see inventory come on line. When it does and you get capital flows restored to the market, you'll begin to see values rise. This is a capital deprived recession. It's not a market-induced recession. So if we can restore capital flows, equity capital flows in real estate, values will go up. A return to Glass-Steagall might make banks act like banks, instead of real estate companies."