"BILLIONS" of Reasons To Read and Watch Today
10/25/23
Opening Comments
My last piece was about lessons in fiscal responsibility from Warren Buffett and the most opened links were Ken Griffin’s $1bn estate and 34 frugal living tips from Buffett. The commercial R/E videos received a lot of praise. Here is one short video from the commercial R/E discussion.
I am being asked by many people to have some sort of job postings for those seeking work and those wanting to hire. I will look into how to do it through a link. The Rosen Report has helped over a dozen people find jobs including CIO level. If you think this is an idea of interest, let me know. I have a couple of solid summer intern candidates as well. I would consider building a website which would be a link in the report.
Video of the Day-A Concerning Video About Dangers of Public Restrooms
Markets/Breadth
Inflation Following Dangerous Historic Chart
Illegal Immigration is a Bigger Problem Than Ever (WSJ)
Smart Phones for Kids
$75mm NYC Condo Sale at 220 CPS
Pembroke Lakes Mall Loan Issues
Dropbox San Francisco Office
NYC Housing Crisis is Self-Inflicted
Video of the Day-A Concerning Video About Dangers of Public Restrooms
This is a short, but eye-opening video of issues caused by using public restroom toilet paper. Drug addicts are using toilet paper rolls to clean needles. They stab the side of the toilet paper roll to clean off blood and drugs. You don’t see it when you grab the toilet paper. According to the short video, people are dying in California from using toilet paper in public restrooms.
BILLIONS of Reasons to Read and Watch Today
Despite having countless setbacks in my life, I am one lucky man. I had a career that far exceeded my expectations and have enjoyed my “retirement” with my family as I wanted to give my children something I never had, a present father (mine died when I was 5). The Rosen Report has kept me sharp and improved my already impressive network. I have been doing more speaking engagements (podcasts, keynote speeches, hosting panel discussions…) and really enjoying connecting with people.
A reader and now, a good friend, Eli, reached out about moderating a panel with Brian Koppelman and David Costabile. Brian is a writer and showrunner in Hollywood responsible for major hits like Rounders, Oceans Thirteen, Billions and many others. David Costabile is a fantastic actor from The Wire, Breaking Bad, Better Call Saul, Suits, and Billions (Wags).
The panel was in celebration of the launch of 10 Bryant, the newly re-positioned 452 Fifth Ave. 10 Bryant is a premium commercial real estate building bordering Bryant Park and Fifth Avenue, just minutes from Penn Station and Grand Central. The ownership team is investing tens of millions of dollars into upgrading the building from concourse to rooftop. They’re reimagining the lobby, building an exclusive tenant-only lounge called Club 10, creating a high-end, holistic fitness and wellness space, renovating two terraces, constructing a double-height garden loggia space, plus curated retail, fine dining, and a cafe. Spaces are available in the Tower and Base (an ideal headquarters opportunity). 10 Bryant is so iconic and timeless, that Billions has filmed episodes in the building over the years.
I spoke with Koppelman prior to the event and it turns out his father and my father-in-law were in business together over 30 ago. Some of the people he grew up with (Eddie and Richard) are some of my close friends. Yes, a nice game of Jewish geography. I was excited about the interview and I watched 4 seasons (48 episodes) of Billions in 5 days to prepare. I was a zombie, as I watched so much TV on my phone until 3am. The writing, acting, editing, and music are really great and addicting. It was my first true binge-watching of 48 hours of shows in 5 days. I love David Costabile and Paul Giamatti’s characters. My wife was livid that I was watching on my phone in bed in the middle of the night.
Brian and David are amazing people and could not have been nicer to me. We hung out in the green room for 40 minutes before going on stage and the two Hollywood hitters were so entertaining. Watching Costabile go from David to “Wags” in a nanosecond was eye-opening. Clearly, I won’t be a big actor any time soon.
I had a great time and the panel was a big hit. The ownership of the building was fired up about the event and I was on Cloud 9. I invited a dozen of my close friends to watch, and they loved the banter and information from Hollywood insiders. I am going to release some clips today and the full show in the future. There is some strong language in the videos, but these guys were amazing and so much fun. As the interview wrapped, Koppelman said, “Eric did an incredible job tonight.” I was beaming and so appreciative. Brian did not have to do that and it shows how good of a person he truly is. I really like Brian and David and hope to hang with them again soon. Brian, remember, when you come to Florida, we are playing golf and tennis.
Brian, I have so much content for you to write a show or movie, you have no idea. Read the Rosen Report and you will find out! Thank you to Brian and David for being amazing panelists and allowing me to look good. Yes, I gave them both Rosen Report hats and they posed for photos. As you can see, I was not having any fun!
STRONG LANGUAGE-The entire video is 1 hour and I will be putting in excerpts in coming weeks.
Brian Koppelman’s Take on the Demise of NYC-He is a die-hard NYer. 2min
David Costabile’s first role and the start of his acting career.1 min
How did Koppleman and Costabile meet at Tufts. VERY FUNNY story. 6 min
When do you know when a show is going to be great (David Costabile). 5 min
The story of pitching Billions-Amazing how Hollywood works. 4 min
Quick Bites
Treasuries have been volatile and sold off again on Wednesday and stocks were hit due to rates and Google earnings. The S&P was -1.2% and Nasdaq -2.32% on the day (as of 3:30pm). The S&P is now down 9% and Nasdaq -11% from the July highs. The 10-year Treasury was 11bps higher in yield @ 4.95% and the 30-year was +12bps to 5.08%. I have written about my concerns over the lack of market breadth during the strong rally in stocks. The chart below does a good job of putting it into perspective. As of Friday’s close, only 33% of the S&P stocks are above the 200 day moving average, a YTD low. The 2nd chart shows the underperformance of small cap stocks. The 3rd chart shows US earnings underperforming. Oil is trading at $85 as the push and pull of weaker economic fears is offset by the Middle East turmoil. Bitcoin is approximately $35k and has doubled since the beginning of the year, but remains about 50% off the highs.
This is an interesting article by Market Watch entitled, “Inflation is following an ‘eerily similar’ path as the one taken in 1966-1982,” and it got me thinking about it. My base case is NOT this scenario, but I can paint a picture on how we can see a spike in inflation. Obviously, with the war in the Middle East, we can have a sharp decline in oil output leading to a sharp increase in oil prices. I can see $125+/barrel oil if things escalate. Also, the US just finished the fiscal year with a $1.7 trillion deficit (22 years in a row of deficits). With interest expenses exploding, wars in Ukraine and Israel, a massive immigration crisis, and runaway spending, where do you think deficits are heading? The Treasury market is selling off sharply and funding costs are rising. Many commercial banks and sovereign wealth funds have significantly pulled back on buying Treasuries, and the Fed is now a seller (Quantitative Tightening) after being the biggest buyer (Quantitative Easing) for years. No, I do not see a repeat of the chart below, but can see a reversal of the recent inflation improvements. Check out the CBO’s projections for spending and deficits. They are not pretty. Of note, historically, they have been wrong and too conservative (meaning higher deficits). Fed Chairman Powell said the US fiscal path is “Unsustainable.” Well, I have been screaming about this for some time. I am glad you finally agree. I like this headline: “Jamie Dimon rips central banks for being ‘100% dead wrong’ on economic forecasts.”
This is an eye-opening WSJ article, “Illegal Immigration Is a Bigger Problem Than Ever. These Five Charts Explain Why." Historically high numbers of people are illegally entering the U.S., straining an immigration system already overwhelmed by the number of families coming across the border to request asylum. Border agents made 2.05 million arrests in the federal fiscal year that ended in September, new government data show, the second year in a row that figure has exceeded two million. Smugglers encourage adults to travel with children, telling them they are likely to be quickly released into the U.S. because the Border Patrol doesn’t have the capacity to hold families for more than a day or two. Once released, they can wait years for their cases to be processed in clogged immigration courts. Recently, a large number of people are coming from countries that have strained ties with the U.S., making deportations difficult or impossible. What is a country without a border? We need a border and an immigration plan. The US lacks the resources to handle these inflows. Walk around NYC and tell me how well it is going. I am not supportive of the immigration policies today, but open to solutions that allow some immigration that the country can handle, and it is not 270,000/month.
This CNBC article is entitled, “Want to raise happy, successful kids? ‘Wait as long as possible’ to give them a phone, says Yale expert.” I think it makes some good points. My wife and I were the last people to give our kids phones in their class. I feel smartphones are AWFUL for kids given social media and the damage caused by it. However, your children become lepers if everyone else in the class has one, is communicating through them and your child is not participating. We never allowed video games in our home. I feel that rule hurt Jack’s socialization in middle school. All the boys were playing Fortnight and Jack was the odd man out. There is a happy medium. Don’t rush giving your kids phones and access to social media, but if you wait too long, the kids are on the outside looking in. Children ages eight to 12 who have phones spend just under five hours a day glued to their phones, and teenagers rack up nearly eight hours of screen time per day according to Common Sense Media. On a related front, check out this headline from Tuesday, “Meta sued by 42 attorneys general for addictive features targeting kids.” This article suggests teens want their parents to track them-Teens Want Parents to Track Their Phones and Monitor Their Every Move.
Israel Headlines
Video Analysis Shows Gaza Hospital Hit by Failed Rocket Meant for Israel
The video makes it official. All the Liberal news agencies that are questioning this topic need to make a statement. Despite this, our very own Rashida Tlaib still believes Israel is responsible. You know it is bad when Marjorie Taylor Green (who believes rich Jews used laser beams to start fires), is going to bring a resolution to censure Tlaib accusing her of antisemitic activity.
US troops in Middle East attacked 14 times, injuring 24 people over the last week: Pentagon
There's been 11 attacks in Iraq and 3 in Syria, according to Pentagon officials. Sadly, this seems to be to be escalating with Iran, Saudi, US and now Chinese ships in the mix.
White House says Iran ‘actively facilitating’ some attacks on US military bases
Saudi Arabia intercepted Houthi missile headed toward Israel — report
Massive rocket barrage on Tel Aviv leaves over a million Israelis scrambling for shelter
Hamas terrorists: We were told 'whoever brings a hostage gets $10,000'
Israel vows to step up Gaza bombardment ahead of expected ground offensive; West Bank mosque hit
Squad of female IDF combat troops eliminated nearly 100 Hamas terrorists
Maybe we should give the Iranian government (KNOWN TERRORIST SUPPORTERS) more money. Don’t look at the #s under this administration. TENS OF BILLIONS that Iran has benefited relative to the last administration.
New elite Israeli unit to hunt down every Hamas terrorist involved in sneak slaughter
Hamas gunmen were ‘high on drugs’ during terrorist attacks on Israel
I think Chappelle is generally funny. After his comments, I will never listen to him again. The list of haters is growing (NYT, Keith McNally, Lush, the Squad, Chappelle, John Cusak, Dua Lupa, Gigi Hadid, Susan Sarandon, Harvard, Penn, Berkely and so many more). I respect people’s views, but as a consumer respect that I can spend my money anywhere and will not support businesses that hate Israel.
AP Refuses to Let its Reporters Describe Hamas as a Terrorist Organization
Michigan State apologizes for Adolf Hitler image on Spartan Stadium scoreboard
The Campus Peril to Western Civilization
Student and faculty reactions to Hamas’s atrocities demonstrate once and for all the fraud of elite higher education. We must reform our universities—or create new ones. The article makes some interesting points. I just don’t like the trajectory of higher education (cost, value add, teaching, environment) in many cases.
Ivy League among top recipients of $8.5 billion Arab funding
A wise man once said, “Follow the money.”
Jewish schools adjust security as Israel-Gaza war stokes fears
Coca-Cola has quietly scrubbed references to Hamas-supporting BLM from its website
New York Times admits it relied too heavily on Hamas claims in Gaza hospital attack coverage
Remember, the NYT just hired someone who praised Hitler. The NYT has had so many bad calls going back decades. This link shows some very questionable reporting about the Holocaust, Duke University lacrosse case, Antisemitic employees, reporting of AOC and the Iron Dome, Nazi crossword puzzle, and many others. NYT was on the wrong side on Hunter Biden Laptop, Steele Dossier, Russian Disinformation…. The list is long. One of my favorite letters was Bari Weiss’ resignation letter from the NYT in 2020. Please read it.
MSNBC’s Mehdi Hasan Is Back on Air and as Anti-Israel as Ever
About 100,000 protesters join pro-Palestinian march through London
I will not be going over to Europe anytime soon.
Hamas fugitive buys UK-funded home in most Jewish part of Britain
Israel Video
Amazing short video about the lack of knowledge about Palestinians and Israel. MUST WATCH TV.
Son of founding Hamas leader issues stark warning: 'A lot more dangerous' than ISIS
Short video of the son of Hamas leader and it is concerning.
Other Headlines
Bill Ackman covers bet against Treasurys, says ‘too much risk in the world’ to bet against bonds
Alphabet shares drop as cloud miss overshadows better-than-expected overall results
Stock was -10%. The S&P Communication Services sector was -6% as of 3pm on Wednesday.
Microsoft ticks up on faster cloud growth and hopeful revenue forecast
Barclays down 6.5% after warning of fourth-quarter cost-cutting charges
GM tops Q3 expectations but pulls full-year guidance due to mounting UAW strike costs
Spotify stock jumps 10% as cost-cutting boosts streamer to first quarterly profit in a year
Chevron to buy Hess Corp for $53 billion in second oil mega-merger in weeks
I still believe eating right and exercising is the best way to go. I am concerned about the long-term side effects of these drugs, but everyone I know who took them lost a lot of weight.
Yes, There Is a Best Time of Year to Buy a New Car
The closer you get to the new model’s arrival date, the more you can save on older models.
Rep. Mike Johnson voted new House speaker
His first bill will be to support Israel. He won 220 to 209 (Jeffries). He will also be focusing on the debt levels.
Trump Announced Sidney Powell Joined His Legal Team In 2020, Now Claims She Was ‘Never’ His Lawyer
Haley pulls dead even with DeSantis — but Trump still crushes the GOP presidential field
Sadly, Trump is killing all other Republican candidates in polls.
'I will never vote Biden': Some Muslim Americans in a key swing state feel betrayed by the president
Oregon suspends basic skills graduation requirement again, citing harm to students of color
High schoolers in Oregon won't need to demonstrate basic competency in reading, writing or math in order to graduate for at least five more years because such requirements are unnecessary and disproportionately harm students of color.
14-year-old who invented soap to treat skin cancer named America’s Top Young Scientist
Former Philadelphia police officer sentenced to prison after admitting to sex assaults
On the list for the worst mayor of all time.
Illegal pot shop opens across from Queens borough hall, DA’s office, court: ‘Nobody cares anymore’
China is no friend to the USA.
Halloween chocolate is pricier this year as El Niño hits cacao bean crop
Good ideas.
The 10 most affordable college towns in the U.S.—half are in Texas
Minnesotans are the least stressed out people in America
I am not sure there are many places I would want to live any less than I would want to live in Minnesota given the weather.
Real Estate
A former Hudson Valley business executive sold a unit at Vornado Realty Trust’s 220 Central Park South for 35 percent more than what it cost four years ago.
A trust tied to Hudson Valley Lighting Group founder David Littman sold Unit 45A at the Billionaires Row tower for $75 million, Crain’s reported. That’s only slightly below the $76 million contract inked between the seller and anonymous buyer in May. The buyer also signed a deal at that time to buy a one-bedroom unit on another floor for $4.5 million. The three-bedroom unit at the Midtown supertall last sold in 2019 for $55.5 million, 35 percent less than its latest deal. This is the link to the unit. The recent sale of the 6,600-square-foot unit works out to more than $11,000 per square foot. I do not love the location of the building, but it is the nicest building I have ever been into in my life. The amenities, service, and restaurant…are on another level. The gym is stunning. To me, the units are shockingly small for the price of $11k/ft and the kitchens were not impressive in the units I saw. I presume if you get a massive unit it is another story.
The credit rating for Brookfield Property Partners’ loan for the Pembroke Lakes Mall in Pembroke Pines was downgraded and watchlisted, raising doubts over the firm’s ability to pay off or refinance the debt maturing in 2025. Credit rating agency KBRA downgraded the bonds backed by the $260 million debt, citing a “continued decline in operating performance,” according to a KBRA surveillance report issued this month. Separately, research firm Morningstar has the loan watchlisted due to a decline in net cash flow, spike in the loan-to-value ratio and challenging lending climate. I grew up in Pembroke Lakes. When I was a kid, I rode my bike to fish where the mall is now and caught a bunch of big largemouth bass. The mall was completed in 1992 (I was living back in Chicago by then). Just another mall loan going bad.
Dropbox said Friday that it’s agreed to return over one-quarter of its San Francisco headquarters to the landlord as the commercial real estate market continues to soften following the Covid pandemic. In a filing, Dropbox said it agreed to surrender to its landlord 165,244 square feet of space and pay $79 million in termination fees. Under the amendment to its lease agreement, Dropbox will offload the space over time through the first quarter of 2025. The late September office vacancy rate in San Fran was 33.9% and the availability rate is approaching 40%.
Progressives are jumping on the Community Service Society’s finding that a third of New Yorkers are paying over half their income for rent to call for even harsher rent controls, but the real cause of the city’s housing crunch can be found in the New York Building Congress report that the Big Apple is on track to construct only about 11,000 new housing units this year, half the 2022 number. Until the laws make it financially practical to build new housing (and upgrade old units), the housing supply will keep shrinking — and, since no one can repeal the law of supply and demand, that means prices will keep rising. They’ve blocked renewal of the 421-a tax break for private housing developers, which was behind 75% of the new affordable units built over the last 20 years. And they passed the 2019 “Tenant Protection Act,” which has forced landlords to take 43,000 units off the market because they can’t afford to bring them up to code. Property taxes are soaring even as the city keeps rent hikes far below inflation (not to mention other rising costs) for rent-stabilized buildings. Hundreds of small landlords are now underwater as costs exceed their rent-roll income; soon enough, it’ll be thousands — which means an ever-growing number of buildings deteriorating toward uninhabitable conditions. I keep getting shown R/E deals in NYC and am passing on ALL of them. You cannot be a landlord in NYC with these ridiculous laws. Sadly, they do not help the tenants as advertised.
Get comfy, homeowners: It can take up to 13.5 years to break even on your purchase, per Zillow data exclusively shared with Axios. Why it matters: You'll have to stay in your house for more than a decade before you can sell and make a profit. Context: Historically, experts have said you need to stay in your home at least five years to break even. But with mortgage rates inching toward 8%, new homeowners will need to stay put longer to avoid going underwater.
Rosen Report™ #625 ©Copyright 2023 Written By Eric Rosen
