Opening Comments
My last note solidified my greatness as the best clearance sale shopper ever after my golf club put my picture on the last sale rack. The most opened links were the simple ways to teach your kids about money and the tech genius who flipped the table on internet scammers. Interestingly, the story about the insider trading of the corporate exec who bought stock/options in a competitor created the most email traffic.
The JPM HY Conference I attended Monday and Tuesday this week was great and nostalgic for me given my long ride running the JPM Credit Trading business. Most of my favorite career memories took place at 270 Park Avenue while at Chase/JPM. Approximately 3,000 attended the event at the Loews Hotel in Miami Beach. A lot of world-class people continue to work at JPM, and it was great to see old friends who were colleagues, clients, and partners. There were some informative panels and I enjoyed my whirlwind 1.5 days at the conference. I was stopped dozens of times from all kinds of bankers, traders, salespeople, analysts, hedge fund managers… talking about the Rosen Report. Multiple readers told me their spouses love reading it which made me smile. Some told me they go over the RR at the dinner table with their teen kids.
When I moved to Florida in 2017, I went down to Miami maybe 5-7 times a year. During the pandemic, rarely. Now, I go at least 8 times a month. So many of my friends live there, amazing restaurants, conferences, sporting events, Art Basel……
Markets
US $ Strength
Jamie Dimon/David Solomon on Economy
Steve Jobs Management Tips
Media Bias
South Florida High-End On Fire
Cities For Best Quality of Life
Miami Office
Canadian Pension Fund R/E Fire Sales
German Commercial R/E Woes
Video of The Day-PR Story
This short video explains that Double Tree Hotels give each guest a warm chocolate chip cookie to the tune of 75,000 cookies/day pre-pandemic. A survey found that 1/3 of the guests told a story of the warm cookie resulting in Double Tree spending far less on advertising than their competitive set.
Size Matters
Get your minds out of the gutter. This is the Rosen Report is a family show. This segment is about the size of your office desk. The Rosen Report has afforded me the luxury of expanding my already impressive network. I meet so many amazing people through my bi-weekly rantings. One such person is Ted Merz. He is a very accomplished journalist and sent me thoughtful suggestions for the Rosen Report a couple of years ago. I had the pleasure of having lunch with him in NYC recently and he is a fascinating person with much to tell. He was a 32-year veteran of Bloomberg and now writes a newsletter of his own, Surface Area. He recently wrote an amazing piece entitled, “How Big is Your Desk.”
In the article, Merz wrote about Michael Bloomberg’s belief in having small desks and no offices to foster communication and community. “There are no private offices at Bloomberg,” he told the Hollywood Reporter in a 2015 interview. “My desk is exactly the same size as everyone else’s.” Mike’s view is that bigger desks, just like walls and offices, create barriers to communication. They obstruct the information flow that is the lifeblood of modern knowledge workers. This isn’t about big policy decisions, but the idiosyncratic markers that help define company values. Like the pledge from Costco’s CEO that the company will never raise the price for a hot dog lunch at its stores above $1.50. That reinforces a message that Costco is cost-conscious.
I am 100% in agreement with Bloomberg’s views on communication and community. When Bloomberg left to become the NYC Mayor, the new management team created larger desks and personal offices. Bloomberg was irate and when he returned to the office, he mandated it be changed back to foster teamwork. He, like me, sat among the team with no office. I love Bloomberg and wish he could become President. I offered Mayor Bloomberg my services for the 2016 election, and told him I would shut my hedge fund to be part of his team.
Ted’s article reminded me of how I managed people. I had a large team and RARELY sat in my corner office. I preferred to be at the desk and be accessible. Hearing what was going on in real time helped me to connect with my team and manage risk. Grabbing lunches with colleagues and talking about markets as they were unfolding was hugely beneficial for me to manage and develop talent as well. I am a strong believer in Bloomberg’s philosophy of managing a team while working with them side by side and having a common desk size is important. Communication and coordination are keys to success. Bloomberg has built an empire and I believe the success is in large part due to his vision and leadership.
When I took over the Credit Trading business in 2004 at JPM, I purposely did not sit next to my old group as I wanted to ingratiate myself into my new team. I sat with the High-Grade Bond Trading Group in the middle of the floor. This allowed me easy access to constantly walk the aisles to the entire team and be accessible. I believe this is one of the many keys to running a successful organization. I also was generally the first person to arrive on the trading floor by 6:15 am. I felt being early set the tone. Up at 4:45 and at the gym/pool by 5:10 and straight to the office.
I believe when it comes to hiring, managing talent, and mentoring people I have a core competency and a track record. I surely would not have been able to do it from a corner office.
I also did a podcast with Ted where we talked about a myriad of topics including his time at Bloomberg, and you can find it by clicking on the picture below.
Quick Bites
Stocks sold off slightly Wednesday and are down a touch on the week, but nothing major. Bitcoin is now +36% YTD and +159% for the past year and is now at $60k or 13% below the all-time high of $68.9k. The gains came on the back of MicroStrategy disclosing another large purchase of about 3,000 bitcoins for $155 million.
Good Yahoo Finance/Bloomberg article on the strength in the US Dollar. The US dollar is cruising at near two-decade highs once more. The Bloomberg Dollar Spot Index has been on quite a ride since the pandemic, but recently gained strength once more and appears to be consolidating at levels comfortably higher than pre-Covid. Meanwhile, the decline of emerging market currencies against the dollar continues unabated. The greenback is riding a wave of US exceptionalism in financial markets. The dollar is a punchy 17% above its average over the past two decades. What gives? Unrelenting flows into US risk assets, economic resilience in the country and the lessened prospect of imminent interest-rate cuts from the Federal Reserve. And a recession is no longer a given: economists surveyed by Bloomberg have marked up their forecast for 2024 US growth to 2.1% and lowered the odds of a coming recession to 40%.
Jamie spoke at the HY Conference I attended and was quite negative relative to market expectations. He thinks there’s a better-than-even chance that the U.S. is heading for a recession, though he doesn’t see systemic issues looming. Speaking Monday from the JPMorgan High Yield and Leveraged Finance Conference in Miami, the head of the largest U.S. bank by assets said markets probably aren’t pricing in a strong enough probability that interest rates could stay higher for longer. Dimon noted “there are things out there which are kind of concerning,” and he disagreed with the high level of probability being assigned to the economy missing a recession. “The market is kind of pricing in a soft landing. That may very well happen,” he told CNBC’s Leslie Picker. “But the [market’s] odds are 70 to 80 percent. I’ll give you half that, that’s all.” However, Dimon feels “most people will muddle through this,” with respect to commercial R/E, while many prominent billionaires disagree. Goldman CEO, Solomon has concerns as well. "The world is set up for a soft landing," said Solomon. The markets are pricing in a high probability of it too, he added. However, "my own view is it's a little bit more uncertain than that," Solomon said. He added that while the "upper half of the economy" in the US has been holding strong, some consumption segments are starting to crack.
Good Fortune article about Steve Jobs three best management tips. Hard to believe he died in 2011 and would have been 69 years old today. When Jobs and Apple’s other cofounders, including Steve Wozniak, first realized how big their company would be, they decided to go out and hire what they called “professional management,” or folks who just knew how to manage people. But it quickly backfired. That’s the first of Jobs’ best management tips: elevating the people to management who perform at the highest levels. “You know who the best managers are. They're the great individual contributors who never want to be a manager, but decide they have to be a manager because no one else is going to be able to do as good a job as that,” Jobs said in the same interview. Another key position held by Jobs was that Apple would be a collaborative company—and uniting his employees with a “common vision” was a central concept. “That's what leadership is: having a vision, being able to articulate that so that people around you can understand it and getting a consensus on a common vision,” Jobs said in the 1985 interview. Jobs took it upon himself to be heavily invested with and involved in recruiting at Apple. He wanted people who were “insanely great at what they did” but “not necessarily those seasoned professionals.” It is hard to argue with Jobs’ success. Having said that, I don’t always like to promote the best person to the manager. If they are amazing producers, that does not mean they will be amazing managers and you lose your top producer.
I have often written about the bias in the media and social media. This NY Post article is entitled, “Google News’ bias skewed even further left in 2023 — 63% from liberal media sources, only 6% from the right: analysis. More concerning data showed that Google News consistently displayed articles with a left lean than right on six hotly-debated topics: abortion, climate change, economy, election, immigration and Biden. If Google News leaned so far Right, I would be equally as concerned. AllSides’ findings come on the heels of another Google product — its artificial intelligence-powered text-to-image software, Gemini — being dragged on social media for rendering “absolutely woke” images. Google has since admitted its AI image tool was “missing the mark,” and paused the tech. Also, the CEO called the blunder, “unacceptable.” Scary and accurate quote from Marc Andreessen (Netscape Co Founder): I know it’s hard to believe, but Big Tech AI generates the output it does because it is precisely executing the specific ideological, radical, biased agenda of its creators. The apparently bizarre output is 100% intended. It is working as designed. A recent study from Syracuse University found that 3.4% of American journalists identify as Republicans while 36.4% identify as Democrats. The initial study from 52 years ago revealed that 35.5% of respondents said they were Democrats, 25.7% said they were Republicans and 32.5% said they were Independents. Here are perfect examples of media bias from today. The Associated Press (currently being sued for its links to Hamas) conveniently failed to mention in a report on the Georgia murder of nursing student Laken Riley that suspected killer Jose Antonio Ibarra crossed the US border illegally. NBC, meanwhile, buried the inconvenient detail of Ibarra being an illegal migrant waaaaaaay down in the 37th paragraph of a Sunday story on the murder.
Israel
'Lebanon will be next': Iran greenlights Hezbollah attack on Israel
Israel kills Hezbollah commander with airstrike on car carrying him through streets of Lebanon
Biden says he hopes to see a cease-fire by next week in the Israel-Hamas war
Iran has the largest ballistic missile arsenal in the Middle East. Now it’s sending them to Russia
“Innocent Palestinian civilian” in Gaza city:
Video of a Palestinian Civilian supporting Hamas and calling for more attacks on Israeli civilians.
No serenity for Jerry Seinfeld as he’s berated by anti-Israel protesters outside NYC event
Dating App Hinge Bans Israeli Man’s Account Who Wore IDF Uniform, Posed with Machine Gun
Other Headlines
Soaring number of Americans are now 401(k) millionaires
Zoom shares jump as quarterly results beat on top and bottom lines
Viking Therapeutics stock jumps 80% after positive weight loss drug trial results
Macy’s will have 350 stores by the end of 2026.
Apple cancels plans to build an electric car
Thousands of employees worked on the project that never came to fruition.
Hotel Staff Shortages Threaten to Push Travel Costs Even Higher
AT&T will give $5 to customers hit by cellphone network outage
Trump’s Favorability Rating Reaches the Highest Since 2022
Trump Pledges to Slash Taxes If He Returns to the White House
Given the CBO is projecting $20 trillion in deficits over the next 10 years, I am not convinced tax cuts are the best way to go. I would rather focus on cutting spending and balancing budgets. Trump is also back on his tariff plans on imported goods including higher rates on Chinese products.
Trump makes series of worrying blunders at weekend rally
Both of the leading candidates are too old and past their prime.
Draft RNC resolution would slow the party’s embrace of Trump as the nominee
A second resolution would bar the Republican National Committee from paying the former president’s legal bills.
Influential Koch network stops spending for Nikki Haley to focus on Senate and House races
Nikki, you lost four in a row including your home state. Time to throw in the towel.
Trump and Biden won Michigan. But ‘uncommitted’ votes demanded attention
Mitch McConnell to step down as Republican Senate leader in November
No state income taxes and Florida is able to pay down debt. Maybe other states and the Federal government should take note.
Putin’s ‘greatest hits’: Russian dissidents continue disappearing in pattern of bizarre deaths
Plane crash, shot, fall, poisoned, beaten…. Don’t get on Putin’s bad side. Navalny was “cold tortured.”
Hysterical 3-minute video about Trump and Biden sneakers.
Read The Death Threat Sent To Donald Trump Jr. With White Powder
'Chaotic' US Congress faces whirlwind of shutdown, impeachment, border fights
“We are here today because California public safety is in crisis.
Powerful 5-minute video is from a California Sheriff who is complaining about woke policies causing massive increases in crime. He called out Newsom. Nothing can get me to move to California today and I loved that state (weather, surfing, fishing, golfing, skiing…).
Brooklyn neighborhood terrified after deli worker executed over $2 cigar
Welcome to Hell. Homeless man steals an excavator, digs a hole and builds a cabin in a public park. It had a washing machine and treadmill and caused a lot of damage.
Microsoft Brags That It Pays White Employees Less Than Non-White Employees Despite ‘Same Job Title’
“All racial and ethnic minority groups who are rewards eligible combined earn $1.007 total pay for every $1.000 earned by US rewards-eligible white employees with the same job title and level and considering tenure,” the Microsoft report, first reported on X, brags.
How China is flooding America with fentanyl on purpose to undermine our society
Concerning story with a great map in it. China is not to be trusted for anything.
Abu Dhabi’s Largest Firm Adds AI-Powered Observer to Board
The company believes the move will help human board members make better decisions. YIKES!
I’m a longevity expert-these are the 4 supplements I take every day to fight aging
Plant-based diet (I’ll pass), Vitamin D, B-12, and a few others.
Lose belly fat fast, feel better in days — just stop eating this one type of food
Refined Carbs (pasta and bread). Agree 100%.
I’ve lived in the Netherlands for 14 years—why we’re always ranked one of the world’s happiest countries
I am all for saving money but living at home at 31 is too much.
Beverly Hills middle schoolers circulate AI-generated nudes of classmates
Being a teen today is very hard. Social media is horrible for children and now they have to deal with AI. Scary times.
Let me be clear. Roscioli is good, but not amazing. I did 6 restaurant reviews in this Rosen Report including Roscioli.
Arizona wrestler becomes first girl to win high school state title
Wildfire grows into one of largest in Texas history as flames menace multiple small towns
500,000 acres burned.
Real Estate
South Florida high-end has caught fire again (peak buying season). Many deals $15-30mm have happened recently. Lots of waterfront homes and the buyers continue to be from the expected places. Yes, the migration has slowed, but it continues and the high end from Miami to Jupiter remains hot. Rocky Balboa also known as Sly Stallone decided to permanently leave CA for the Sunshine State.
I thought this CNBC story about cities with the best quality of life was interesting. I would not live in any of them. Florida cities did not make the US News and World Report list despite being the #10 state on the latest survey.
Article from Bloomberg entitled, “Miami Beach Office Asking for Top Rent Signs First Tenant.” It suggests hedge fund, J. Goldman agreed to lease approximately 10,000 square feet in a new building South of Fifth Avenue. The article did not outline the exact rent of this deal, but suggested the building could fetch as much as $170/ft. Not all markets are like NYC, Chicago, DC, LA, San Fran, Seattle…. Some office markets are hot, and Miami, Palm Beach, Nashville, Dallas and others seem to be holding up well in many cases.
Concerning Bloomberg article outlining fire sales by Canadian pension funds commercial R/E positions. Canadian pension funds have been among the world’s most prolific buyers of real estate, starting a revolution that inspired retirement plans around the globe to emulate them. Now the largest of them is taking steps to limit its exposure to the most-beleaguered property type — office buildings. Canada Pension Plan Investment Board has done three deals at discounted prices, selling its interests in a pair of Vancouver towers, a business park in Southern California and a redevelopment project in Manhattan, with the New York stake offloaded for the eyebrow-raising price of just $1. The worry is those deals may set an example for other major investors seeking a way out of the turmoil too. The article outlines other sold positions at up to 75% discounts as well. What do these levels indicated for the loans on these projects and the new taxes that can be collected?
German Banks Commercial Property Loans are Souring according to this Bloomberg chart.
© 2024 The Rosen Report LLC. All rights reserved. Does not constitute investment, financial, legal or tax advice. Consult with your lawyers and professional financial advisers. Rosen Report™ #660 ©Copyright 2024 Written By Eric Rosen.
