Opening Comments
I am Full of Crap
Web 3 and the Implications-IMPORTANT
Picture of the Day-NFT Educational Video
Alley Cat-Good Food In Boca
Quick Bites
Markets, Poorest Gaining, Manchin-”No” BBB
China Under Pressure, Turkey Under Pressure
WFH, SFO 360 on Defund Police
Generals Prepare for 2024 Civil War
Dumbest Bank Robber EVER
Other Headlines (expanded COVID section within)
Virus/Vaccine
Data-Trends Declining, but at a Slower Rate
UK Data
NYC Under Siege
Pfizer on the Pandemic
Vaccines for Kids
J&J Clotting
Real Estate
My General Comments
Boca Data is Impressive. Real Numbers.
Miami-North Bay Road Strikes Again
Florida Migration
School Thoughts
“Hidden Gem” Markets for 2022
Opening Comments
Not surprisingly, my readers laughed at my travel pains and seemed to get the most laughs about the conversation between the “sorority sisters” behind me who used the word, “like” in every sentence.
Omicron is spreading at a rapid rate, something which is going to spoil a lot of holiday travel plans and gatherings. I am starting to believe virtually everyone will get Omicron based on the stories I am hearing about the contagiousness of the virus. Multiple holiday parties resulted in 100% infection rates despite everyone being double vaxed and almost everyone with boosters. Omicron cases were +97% from Friday to Saturday and is now in all but 4 states. However, hospitalization rates in South Africa remain low at 1.7% relative to 19% for Delta. Also, I am only aware of one death from Omicron in the UK. Full discussion in Virus/Vaccine section. I also have an expanded Other Headlines section today to include virus stories which are separated from other headlines. There are articles suggesting Biden’s speech will be to turn the focus from cases to severity . I believe he is speaking on Tuesday. Today, London Mayor, Sadiq Khan, declared a “major incident” due to Omicron.
Please be careful this holiday season. I will be staying local for the holidays. If readers are in my area, happy to meet for a drink; ideally outside. Jack has a three-day golf tournament, so I am unlikely to write anything for Wednesday. Best case would be an abbreviated version.
I am Full of Crap
I let my readers know about my colonoscopy as I want to increase awareness and get anyone who is procrastinating on preventative procedures to get them done as soon as Omicron slows down. This is my 5th colonoscopy given my mother passed away from colon cancer. I was overdue given the pandemic and scheduling in South Florida is impossible. I can only tell you that the preparation is far worse than the procedure, but used the SuTab pills rather than the vile drink. The end result was the same, but you do need to swallow 24 large pills in short order. You need to sprint to the bathroom for hours and cannot get too comfortable sitting on the couch. Usain Bolt could not beat me to the bathroom within 1 hour of taking the pills. I lost 5 pounds despite drinking 100 oz of fluids. When someone tells me I am full of crap, all I can do is agree-other than the day of my colonoscopy, then I am literally not full of crap.
Web 3 and the Implications-IMPORTANT
A loyal reader, Max, sent me this WSJ article about the internet revolution, Web 3. For those of you who watched my podcast on crypto, we spent a fair amount of time talking about “defi” or the decentralization of the world. I had this section in Quick Bites, but felt the need for it to be highlighted, so I moved it up top. One of my goals of the Rosen Report is to help educate my readers about things I am not convinced they know. Many of these topics are not on the front of mind, and due to the power of the network created in part by the Rosen Report, I am able to help explain some of these themes. In the podcast, we spoke about Axi International and the implications, and if you recall, I suggested it was the most important part of the discussion. The WSJ article goes into more detail about the implications as well. I believe the near future looks far different than today on this topic and there are major ramifications. Crypto is built on decentralized networks and its superpowers come from that decentralization. The current internet is a place where anybody can be censored anytime for any reason, by the powers that be and I feel this will not be the case in the near future. Zuckerberg changed the name from Facebook to Meta for a reason, as he sees what is coming. Web 3 can give the power back to the people, and also take the insanely huge monopolistic profits that big tech enjoys and redistribute it CAPITALISTICALLY. I found this informative piece on etherum.org which my Crypto Sensei has me reading. It compares Web 2 to Web 3 and is easy to read for all us Crytpo Idiots. I believe this is important, so please take 5 minutes to read the WSJ article and peruse the etherum.org short piece.
Video of the Day-Short NFT Video
A reader sent me this video on NFTs. It is 5 minutes and a lot of readers are asking me about the topic. To be clear, I have not participated and am frustrated by the euphoria. Don’t get me wrong, I believe the impact of NFTs is real and will last for decades, but I don’t understand spending big money on a piece of NFT art. The video shows a successful NFT investor/creator. Remember, almost $2,5 trillion of wealth has been created in crypto currencies in recent years. I presume a good amount of that was made by younger people who adopted crypto far before us old folks. The short section on NFT creation (silly octopus) just upsets me and tells me I should be an NFT creator. Here is the 5-minute video and there is nothing complex about this discussion, but you will end up irritated if you are anything like me. It had 315k views in 2 days.
Alley Cat-Finally Good Food in Boca
After my travel debacle and crushing of Bar-B-Cutie in the last Rosen Report, I felt a positive review was warranted. I do not write a lot of restaurant reviews in South Florida because the food is so weak, it generally does not warrant my business. I prefer to cook and get quite angry when I go out and spend a lot of money on mediocre food and wine. However, I have uncovered a gem in Boca. Stew on that for a second. Gem, Boca and food tend to be disharmonious like “military intelligence” or “jumbo shrimp.” A new restaurant opened up about 6 weeks ago called Alley Cat and it is indeed worthy of my time and yours. The restaurant is a partnership between Sunset Sushi and Rebel House. The venue is small and getting a table requires a 30 day advance reservation. The food is a combination of cold starters, hot plates with an Japanese flair and sushi. No, it is not the best sushi I have ever had, but it is darn good and not offensively priced, and the menu has something for everyone. I have been there twice in a month, and that is a big statement on its own. I sat at the bar and enjoyed the ambiance and food. The staff is incredibly friendly and the chef, Eric Baker, is great. The food presentation as seen in the pictures is beautiful as well. Coincidentally, I sat next to a lovely couple from Chicago (now Rosen Report readers) and we had a fun conversation.
The Alley Cat website is great and has pictures of all the food. My favorite starters are the octopus, shrimp crispy rice, and wagyu beef dumplings, roasted cauliflower and brussel sprouts. The crispy octopus is delicious, I do suggest you ask to go lite on the bonito flakes, as they are strong. The brussel sprouts are out of this world too, as they are fried and crispy.
My favorite entrees are the sushi tasting platter. The other day, I ordered all of them (tuna, salmon & hamachi) with four pieces each. There are plenty of hot entrees of fish and meat as well. My wife enjoyed the salmon, and I thought it was good as well. Anyone can find something they like and the staff will accommodate reasonable changes. The wine list is good enough as well and I plan on going back….assuming I can get back in there after this review, which will make it harder to get a table. They have a small area outside the restaurant in the alley (hence the name) if you prefer to eat outside. The biggest downside about this experience is it is located in Royal Palm Plaza. The parking is an unmitigated disaster. Give yourself an additional 20 minutes to find a parking spot, and don’t be shocked if you have some door dings. They do have valet off SE Mizner Blvd, but it fills up quickly. The other issue is getting a reservation, which is not easy despite the fact that the restaurant is new. Alley Cat is a welcome addition to Boca Raton and among the youngest crowd I have seen. I did not see one blue haired person or a walker, something you can rarely say in this neighborhood. I checked quickly and it appears Alley Cat is among the highest rated restaurants in Boca on Open Table at 4.8 stars out of 5. However, that does not mean much, as the culinary challenged Boca residents rate the Melting Pot and Capital Grille relatively high too!
Quick Bites
U.S. stocks came under pressure again in Friday’s volatile session amid worries about tighter monetary policy and the ongoing pandemic, leading to a losing week for the major averages. The Dow dropped 532 points, or 1.5%, to 35,365. The S&P 500 fell 1% for a second down day to 4,621. The Nasdaq ended the session less than 0.1% lower at 15,1709 after briefly trading in the green. At its session low, the Nasdaq dropped about 1.5%. The major averages posted a negative week with the Nasdaq being the biggest loser. The tech-heavy benchmark declined nearly 3%, while the Dow and the S&P 500 slipped 1.7% and 1.9%, respectively. The 10-Year Treasury continues to trade at 1.4% despite the new guidelines from the Fed, as the risk-off trade is on. Crypto was under pressure as well with Bitcoin -4.15% and ETH down almost 5%. Some experts are suggesting changing tax laws for crypto may be adding to the selling pressure going into year end. Oil was -3% to $70.
We know the wealthy fared well during this pandemic, but this Bloomberg article shows that the poorest Americans have seen a record increase in wealth since the pandemic. After the crash of 2008, the bottom half of U.S. households saw their share of the country’s wealth plunge close to zero. This time, so far, it’s different. Since the pandemic began last year, there’s been the biggest increase on record in the wealth share held by the poorest 50% of Americans, according to Federal Reserve data published Friday. It rose to 2.5% as of Sept. 30, from 1.8% at the end of 2019 -- after reaching a low of 0.3% a decade ago.
It appears Joe Manchin will vote no on the $1.75 trillion Build Back Better bill. “If I can’t go home and explain it to the people West Virginia, I can’t vote for it. And I cannot vote to continue with this piece of legislation. I just can’t. I’ve tried everything humanly possible. I can’t get there,” Manchin said on “Fox News Sunday,” saying he was concerned with adding to the national debt. White House press secretary Jen Psaki said Manchin’s decision represents “a sudden and inexplicable reversal in his position, and a breach of his commitments to the President and the Senator’s colleagues in the House and Senate.” After Manchin threw cold water on the bill, Sen. Bernie Sanders, the Vermont progressive, still called for a vote on the legislation. Manchin needs to explain why he “doesn’t have the guts” to stand up to special interest groups for working families, Sanders said on CNN’s “State of the Union.” Manchin has been under incredible pressure to vote in favor of the bill. I was not supportive of such a large bill in light of inflation and lack of clarity on where the dollars end up given the huge pork in these bills. I do feel Manchin may be setting himself up for a run at the Oval Office.
Pandemic stimulus helped trigger speculative frenzies in everything from stocks to crypto and property across the world in 2021. China went the other way as Beijing officials took action to deflate bubbles. The result is one of the most extreme divergences between major financial markets in recent history. This year’s selloff in the MSCI China Index of stocks means the gauge lags global peers by 37 percentage points, the biggest gap since 1998. Chinese junk dollar bonds are trailing global high yield returns by about 25 percentage points, the most in more than a decade. While home prices are surging in places like Manhattan, the U.K. and Australia, they’ve fallen in China for the past four months. The country responsible for the pandemic and lied about it as well as bought up PPE hurting every other country is now under performing? Please tell me who is sad to see this happen. New China lockdowns could further impact the global supply chains.
Concerning article about the Turkish stock market and Lira as they fell sharply. Although the Turkish market is up sharply year to date, Friday saw sharp declines, while the lira has been in free fall. The chart on the bottom is the Turkish lira relative to the US dollar for the past year. Istanbul’s stock market was twice forced to halt trading and the Turkish lira continued to fall Friday as concerns deepened that recent interest-rate cuts could cause an inflationary spiral. Turkey’s benchmark Borsa Istanbul 100 index sank 8.5% Friday in its worst day since March, triggering two circuit breakers that halted trades. The lira lost as much as 8% of its value against the dollar, despite Turkey’s central bank intervening to arrest the decline in the country’s currency.
For almost 18 months I have suggested that work from home/work from anywhere will be a lasting result of the pandemic. This Bloomberg article suggests the 5-day a week office job is not likely to return for many. Both employees and managers found working from home during the pandemic was positive for performance and well-being, a report by the OECD found. The proportion of staff teleworking at least one day a week is expected to be much higher than before the pandemic. A separate study by OECD researchers of job postings on the website Indeed found that the substantial increase in advertised telework in Covid lockdowns was only reversed modestly when the restrictions were eased. “These results suggest that telework is here to stay, especially in countries with high levels of digital preparedness,” researchers said. Employers cannot find workers. A hotel near me is short hundreds of employees.
After Black Lives Matter protesters last year demanded that cities “Defund the police,” San Francisco Mayor London Breed held a press conference to announce that her city would be one of the first to do exactly that. Breed cut $120 million from the budgets of both San Francisco’s police and sheriff’s departments. A spokesperson for the police officers’ union warned the cuts “could impact our ability to respond to emergencies.” This week, Breed reversed herself in dramatic fashion, announcing that she was making an emergency request to the city Board of Supervisors for more money for the police to support a crackdown on crime, including open-air drug dealing, car break-ins and retail theft. “I’m proud this city believes in giving people second chances,” said Breed. “Nevertheless, we also need there to be accountability when someone does break the law … Our compassion cannot be mistaken for weakness or indifference … The article gives details about the rising crime including homicides, property crimes, car break-ins and vehicle thefts being driving forces in the change of heart by the mayor. Couple this with lower arrest rates (2019 had 40% of shoplifters arrested, while 2021 had only 19%). Also, the SFO progressive DA, Chesa Boudin, charged just 46% of theft arrests, a 16-point decline since he took office in 2020, and charged just 35% of petty theft arrests, a 23-point decline from two years ago. I never agreed with the defund the police movement, and I am happy SFO politicians are changing their tune. Headlines such as this one clearly did not help the defund the police movement: Police say six men targeted and robbed elderly Asians in the Bay Area: 'Victims … were being essentially hunted.'
An op-ed published by the Washington Post on Friday called for action amid growing concern among former senior officials about the "potential for lethal chaos inside our military" in a flash of violence that could eclipse the Capitol riot on Jan. 6. Multiple courses of action were advised by Paul Eaton, a retired U.S. Army major general and a senior adviser to VoteVets, Antonio Taguba, a retired Army major general with 34 years of active duty service, and Steven Anderson, a retired brigadier general who served in the Army for 31 years. They warned of the possibility of "civil war" resulting from a "military breakdown" due to splits in loyalty. I can only surmise that based on the emails, texts and calls I get from the left and the right that the country has not been so divided since the time of President Lincoln. At this point, nothing would shock me in terms of the great divide between left and right. Very few centrists exist today.
I enjoy seeing just how stupid people can be in the world. This “rocket scientist” bank robber held up a Wells Fargo with a note reading, “This is a robbery. I need $150.” After leaving the bank with his stolen money, he stopped at the ATM in front of the bank and made a deposit of the full amount into his account. Shockingly, the MENSA bank robber was caught after in a shopping center near-by. In an interview, he claimed, “his mind is currently being controlled by a third party via an implant located somewhere in his body.”
Other Headlines
‘Buy now, pay later’ stocks tumble after U.S. consumer watchdog launches probe
Rivian shares slide after company cuts 2021 EV production expectations
Goldman Says $100 Oil Possible as Record Demand Outpaces Supply
Evergrande Boss Leads $46 Billion in Lost Wealth for China’s Property Tycoons
Trump says American Jews ‘either don’t like Israel or don’t care about Israel’ in new interview
'Significant amounts of water' found in Mars' massive version of the Grand Canyon
NYU Is Top-Ranked—In Loans That Alumni and Parents Struggle to Repay
Woman shares hospital delivery room with her ex, his wife in viral video
Radio City Rockettes cancel shows as COVID concerns grow in NYC
Taylor Swift party a COVID super spreader event after 100 test positive
Prince George’s County Public Schools shifts to virtual learning due to uptick in COVID cases
Many schools closed early for the holiday, and I fear given the spread of Omicron, we may have remote learning again in January in places.
JPMorgan Urges Teams to Exercise Caution, Mask Up If Gathering
Federal appeals court reinstates Biden administration’s business vaccine and testing mandate
Fauci says a redefinition of fully vaccinated is ‘on the table’
35% of women who left or lost their jobs during the pandemic are still unemployed
With Too Few Nurses, It Won’t Take Much to Overwhelm Hospitals This Winter
Virus/Vaccine
I have written dozens of times that I do not blame either Trump or Biden for the pandemic. However, the press was relentless on Trump and has been far kinder to Biden on the topic, despite the never-ending surges and disruption caused by the “Wuhan Virus.” We are know seeing a huge increase in testing (+52% during the past two weeks) which will clearly lead to the increased case count. Cases are now 128k and were +17%. If you recall, the growth was 40% last week. I am surprised it is not higher with Omicron. My guess is many have no symptoms. Regionally, the Northeast is seeing the largest spike in cases as Omicron takes hold, but Florida is under siege as well and I believe it is in part due to the Northeasters coming down for the holidays. Hospitalizations are 69k and +18%. Deaths are 1.3k/day and +9%. Surprisingly, the growth rates are slowing for cases relative to the past couple weeks. I would have thought with Omicron, we would have seen a sharper spike in case count. The US positivity rate is now 7% from 4.8% a few weeks ago. Some states are 20-30% in terms of positivity rate. I have spoken with dozens of people who have tested positive and many were not told which variant. Those with Omicron tended to have mild symptoms. Many were double vaccinated with boosters. I attached two new charts which shows the data from New York and Florida. Note the case growth for Florida is 226%. This NPR article suggests the US could see between 500,000-1,000,000 cases/day by the end of January.
NEW YORK
NYC Data from Whitney Tilson
FLORIDA
The following Bloomberg article discusses the UK. England is “almost certain” to be suffering hundreds of thousands of omicron variant cases a day, the U.K.’s top scientific advisers said as they urged the government to act within days to prevent hospitals being overrun. The case chart below is concerning, but the death chart shows improvement.
Almost exactly one month after Mayor Bill de Blasio triumphantly announced tens of thousands of fully vaccinated people could return to Times Square to celebrate New Year's Eve in person this year, the state saw it's highest single-day reporting of new COVID infections. The previous record, set 11 months ago on Jan. 14, crumbled when Gov. Kathy Hochul announced 21,027 new positive cases statewide Friday. The old record for most reported cases in a single day was 19,942, when reported hospitalizations were on the brink of 9,000. Now, the number of people admitted is down by more than half.
New York reported close to the same number of tests taken last Friday, but of that batch (over 260,000), there were 10,000 less positive cases one week ago. Also, when you compare hospitalizations to one week ago, the number of people in hospitals for COVID-19 has risen by about 300, reflecting an increase of 8%. I have spoken with dozens of people and cases are spreading like wildfire. I would not attend a holiday party and cancelled on my favorite party of the year. Schools are getting run over right now. I have spoken with dozens of readers who are double vaccinated with boosters who have been infected in recent days.
“We believe Covid will transition to an endemic state, potentially by 2024,” Nanette Cocero, global president of Pfizer Vaccines, said during an investor call Friday. Covid-19 would reach the endemic level when populations have enough immunity from vaccines or from prior infections to keep transmissions, hospitalizations and deaths under control even as the virus circulates. NO ONE has been right about the pandemic. NO ONE. Fauci, Gottlieb, the WHO, CDC biotech executives… have all been wrong. The virus is gonna virus. However, I do not want another year of living like this. Another holiday ruined. At what point are the Chinese going to pay for millions of deaths, trillions of damages and billions of lives in turmoil? Wars have been started for 10% of what has transpired.
Pfizer and BioNTech announced on Friday that the companies will modify a clinical trial for their coronavirus vaccine in young children, after a two-dose regimen did not produce a sufficient immune response in children ages 2, 3, and 4. The companies said that “no safety concerns were identified” in the trial, and that participants age 2-4 will be given a third vaccine dose two months after their second dose. Participants ages six months to 24 months saw a sufficient immune response from the vaccine.
Most Americans should be given the Pfizer or Moderna mRNA vaccines instead of the Johnson & Johnson shot that can cause rare but serious blood clots, U.S. health advisers recommended Thursday. The strange clotting problem has caused nine confirmed deaths after J&J vaccinations - while the Pfizer and Moderna vaccines don't come with that risk and also appear to be more effective, advisers to the Centers for Disease Control and Prevention said.
It's an unusual move and the CDC's director, Dr. Rochelle Walensky, must decide whether to accept the panel's advice. Due to my research, I purposely did not do J&J despite being just one shot. However, I picked Pfizer and I am not sure with the information today, that would have been the right decision.
Real Estate
In the community, Royal Palm, in Boca, there are currently 7 homes on the market with an average price of $16.2mm. Given the small # of homes for sale, the one asking $45mm is significantly bringing up the average. If you take out the most expensive home, the average asking price is $11.4mm.
For perspective, when I bought my house in May of 2017, there were 70 homes listed between $1.3mm-$18mm with an average price of $4.5mm. There were 40 homes listed for under $5mm in May of 2017. Today, the cheapest listing is $5mm. As hot as it is here, Palm Beach Island and Miami waterfront are far hotter. I ran numbers for the past 5 years below for Royal Palm. Active listings are for December of the year discussed.
2017 YTD 63 homes sold. Active Listings 56.
2018 YTD 60 homes sold. Active Listings 69.
2019 YTD 69 homes sold. Active listings 55.
2020 YTD 73 homes sold. Active Listings 46.
2021 YTD 105 homes sold. Active Listings 7.
This NY Post story is about crypto czar, Ivan Soto-Wright and his new $38mm purchase in the hottest market in Miami, North Bay Road.
The move from high tax woke states to places like Florida and Texas do not need to pick up any steam. However, Omicron could be the straw that broke the camel’s back based on the calls, emails and texts I am receiving right now. It will be interesting to see what restrictions NYC puts into place and what happens with schools. Many wealthy people have one foot out the door and fear Omicron rules could push more to Florida. Sorry, getting into a weak high school in Florida is akin to getting into Harvard or Stanford now. Miami Country Day was a school we looked at 5 years ago and did not like it. They were reading a book in 8th grade that Jack read in 3rd grade at Avenues in NYC. Remember, Avenues is not exactly Horace Mann from an academic rigor perspective. I am being told of many high-profile people being turned away at Miami Country Day now as South Florida does not have enough private schools to handle the flow of new permanent residents. I wrote of a religious school in Boca with room for 700 kids. They had 625 pre-pandemic. As of one month ago, they had 700 kids and 160 families on the wait list, with an average of approximately 2 kids per family. By the way, one of the parents needs to be born-again to be admitted, so the school is not for everyone.
On the school front, I am pleasantly surprised by what I continue to hear about Pine Crest. Many families who have left Horace Mann, Dalton, Columbia Grammar and others are now at Pine Crest and feel the amount of work and challenge is on par or harder than even the toughest schools in NYC. Some feel there is too much homework. If I were moving from NYC and my kids were Horace Mann, Dalton, Trinity, Brearley, Collegiate… I would only seriously consider Ransom Everglades in Miami or Pine Crest in Fort Lauderdale. Those are the two most challenging schools and look the most like a top NYC school and have solid matriculation. Given the influx of people to South Florida, a few more high-end private schools are sorely needed.
My kids take vocal lessons and unfortunately, the teacher left South Florida to move to Knoxville, TN. She was living in a small two-bedroom apartment off Lyons Road and found a 2,700 ft home on 2 acres for a similar rent. She believes the house can be bought for $400k. Housing prices down here are becoming too expensive in many areas in my opinion, but the migration continues. The article here discusses “hidden gem” markets and the vocal coach found one. Next year may not see the runaway home-price growth of 2021, but certain markets are set to see prices rise considerably in the new year. The National Association of Realtors conducted a survey of more than 20 economic and housing experts to gauge their expectations of home-price growth, inflation and interest-rate movements in the year ahead. The group predicted that median home prices will rise by 5.7% in 2022, compared with a 4% rate of inflation overall. Amid this backdrop, though, the National Association of Realtors expects some housing markets to see bumper price growth. The organization’s economists came up with a list of 10 “hidden gem” markets where price appreciation will outpace the national average. These markets include, in alphabetical order:
Dallas-Fort Worth, Texas
Daphne-Fairhope-Farley, Ala.
Fayetteville-Springdale-Rogers, Ark.-Mo.
Huntsville, Ala.
Knoxville, Tenn.
Palm Bay-Melbourne-Titusville, Fla.
Pensacola-Ferry Pass-Brent, Fla.
San Antonio-New Braunfels, Texas
Spartanburg, S.C.
Tucson, Ariz.