Opening Comments
I received a lot of good feedback on the last piece, Big Boy Voice. I have readership growing and want to remind everyone that readers send me story ideas, links, and feedback which help me create content. I write this alone and help from readers saves me time, so keep it coming. When I sit down to write the Rosen Report, I get 15-20 Quick Bite ideas and maybe 100 Other Headlines. I then whittle them down to try to make the piece more digestible and focus on the stories or headlines feel are important or my readers will find interesting. The link above to the last Rosen Report also includes the markets panel I moderated last week which many readers found interesting. If you like what you read, forward it to friends and hit the heart button near my name/picture.
One of my wife’s short in stature friends left her car at our house, and they went for a walk. I had to move her car. In a comical situation, I was trying to fit into the car to drive it, and I felt like Shaq trying to fit into a Yugo. I am not exactly a giant. The woman keeps her seat against the steering wheel. I wish someone had this on video as with my bad leg, it got ugly in a hurry as I attempted to do it without moving the seat.
The leg is healing enough to where I may try to fish this week. The Super Bowl tends to be peak sailfish season. One boat caught 25 in a day last week and over 300 were caught in one day near me. I let 100% of them go, but wow, they are fun to catch. Here is my best sailfish picture from last May. Yes, the bill is like 20 grit sandpaper, so you want to wear a glove to not get cut. I learned that the hard way. Trying to do an overnight trip to on Thursday. Target would be wahoo, snapper, grouper and yellowfin tuna. Hoping we can make it and have some new pics.
Eye on the Market-Michael Cembalest Piece on Crypto
Don’t Put All Your Eggs in One Basket
Quick Bites
Markets, AMZN, Big Tech Losing Its Luster
Oppenheimer Thursday Market Summary
Meta Earnings Explained
Jobs Report-As Good As It Appears?
Biden’s Approval Rating-538 Poll
Spring Break Travel, Remote Work
Single Parent Household Impact on Children
Patek Philippe Watches in Popular Culture
China Olympic Policies and Medal Counts Since 1980-GO USA!
Other Headlines
Virus/Vaccine
Data
Vaccination Effectiveness
Vitamin D Study
Plexiglass Effectiveness
Real Estate
General Comments
Douglas Elliman-NYC Report
How Miami became the most important city in America
More Homes Over $50mm
CA Compound for $110mm
Eye on the Market-Michael Cembalest Piece on Crypto
Mike wrote a 28-page crypto paper giving his views on the sector. I have attached the link to his report here. I always learn from reading these well-written papers, even if I come to a different conclusion. I believe crypto and NFTs will have a lasting impact, despite the fact that many of them will be worthless. I keep learning about new uses of smart contracts and believe we are in the 1st or 2nd inning of the crypto game. I met yet another impressive crypto reader of the all-encompassing Rosen Report and am planning on doing another podcast with him with some of the focus around implications of NFTs in the business world.
While explaining the attraction of crypto currencies, Cembalest shared a list of countries who have not defaulted on their debt at some point, and the list is short. He also questions BTC as a store of value due to volatility. I suggest readers spend 10-15 minutes going through the attachment. There are a lot of charts, so it is not very long. I enjoyed page 14-15 regarding decentralized finance. NFTs start on page 19. Separately, this headline is not good for crypto: $320 Million Crypto Heist Rocks 'Decentralized Finance' World
Don't Put All Your Eggs in One Basket
In 2000, I had a girlfriend who had a studious cousin. He had his PhD in laser technology and was working for Corning Glass Works (GLW). The company specializes in specialty glass, ceramics, and related materials and technologies including advanced optics, primarily for industrial and scientific applications. My girlfriend told me her cousin was worried about all his restricted stock options worth tens of millions but he was “handcuffed” and did not know what to do. I called the guy up and he is clearly brilliant, but he was no trader/investor. Given he was restricted from trading shares of GLW, I explained to him that he needed to buy long term put options on some of his competitors as valuations were stretched and if there is a correction, he could lose a great deal of money on his GLW options. Buying a put option gives you the ability to “put” the shares at a select strike price for a specific cost / premium.
Shockingly, he did not understand the concept of such an insurance program, and despite multiple conversations, I could not get him to pull the trigger. I don’t recall the pricing, but to me, it was a “no brainer” to protect against a sell-off, and the most he could lose was the premium he paid to buy the put option. Well, the .com bubble burst in spectacular fashion peaking in September 2000, and the rest is history. GLW stock went from $113 to $20 in short order and ended up at $1.48 in October 2002. The entire sector was smoked, and all the competitors had similar downdrafts. My recommendation was less about being a market timer and more about hedging your bets, as 100% of his net worth was in stock of GLW. Given that I grew up with limited means, I just do not make those concentrated bets. Some people have made a killing off them, but if it causes me to lose sleep, I need to hedge it.
The most famous hedger of such positions, in my opinion, is Mark Cuban of Shark Tank and the Dallas Mavericks owner. He sold his company to Yahoo in 1998 for $5.7bn and received 14.6mm shares at $95. His stock was worth $1.4bn.
In order to protect the value of the 14.6 million stocks, he decided to set up a costless Options Collar, which allowed him to protect his billions without paying any insurance premium. Here is the detail of the option trade:
1) For each 100 shares of Yahoo stock, 1 contract of put (strike 85) was bought and 1 contract of call (strike 205) was sold. In total there were 146,000 contracts of calls and 146,000 contracts of puts traded.
2) The premium of the put exactly offset the premium of the call, thus there was zero cost for this trade.
3) All options expired in 3 years.
Such option structure is called a Collar and it consists of two legs: buying a downside put and selling an upside call. A costless collar has the premium of the put offsetting the call's exactly so that there is no cost to enter the collar trade.
After Cuban's collar trade was entered, Yahoo's share price reached the stratosphere of $237 in January 2000, making his trade look like a mistake. Then the internet bubble burst, and Yahoo reached the abysmal price of $13 (in late 2002), making his trade a stroke of genius, a great risk management trade without out of pocket costs. Cuban was able to pin down the value of the share (or close to 90% of it), no matter the subsequent movement of the stocks, and preserved most of the initial value he received for Broadcast.
My point is simple; don’t be greedy and take some chips off the table. Learn from Uncle Mark who did it brilliantly and went on to great fame as a result of his phenomenal hedge. How would his life have changed if he rode the stock down 90%? I have a lot of respect for Cuban for a host of reasons, but his stock hedge is legendary. Think about how you size your investments accordingly.
If I needed to do any major hedging, I would call Alon Rosin at Oppenheimer to help me structure the most effective hedge. At our hedge fund, we used him for 80% of our options trading. He also sends me story ideas including the 3rd Quite Bites today.
I have made some crazy crypto moves recently including investing in a fringe crypto staking play called, Wonderland. It was paying 71,000% interest. What could possibly go wrong? Shockingly, my value is down to 70% despite the massive interest rate. There was a reason I sized my bet small. I thought it was too good to be true, and it was. However, I bought about 10 different names and the total portfolio is now only down about 10% despite the broad market carnage as some have gone up nicely. Remember, diversify. Don’t put all your eggs in one basket unless you are prepared for the potential consequences.
Quick Bites
The S&P 500 and Nasdaq Composite jumped Friday to finish their best week of the year, as continued strength in earnings reports extended the tech-led rebound from the January rout. The broad market index rose 0.5% to 4,501, while the and the tech-heavy Nasdaq Composite climbed 1.6% to 14,098. The Dow inched lower by 21 points, or 0.06%, to 35,090. For the week, the S&P 500 1.5% higher, and the Nasdaq rose 2.4%. The Dow ended the week up 1.1%. These gains mark the second weekly advances of 2022 for the major averages — which were under pressure last month as worries of higher interest rates dragged down tech names. Amazon led the S&P’s and Nasdaq’s gains, as it jumped 13.5% on strong quarterly earnings and cloud revenue beats. Snap rocketed up 58.8%, the day after reporting earnings. Despite the SNAP rally, it remains -17% YTD, which is remarkable in a 5 week period. Clorox fell 14% on a weak earnings call which cited inflation with gross margin dropping from to 45% from 33% and cited inflation. Oil rallied almost 2% to $92/barrel and natural gas fell almost 7% to $4.6. Gas prices climbed to the highest in 7 years and averages $3.43/gallon in the US or +40% in a year. The 10-year Treasury yield rose 9bps to 1.92% due to the better than expected jobs report. This is the highest level for the 10-year since December 2019. Crypto has seen a substantial decline recently, but saw a bit of a pop last week with BTC +8% on the week to $41.4k and ETH+16% to $3k. For perspective, recent lows were $35k for BTC $2.1k for ETH. I am surprised by how correlated these have been to markets and rates.
Amazon on Thursday said revenue climbed 9% in the fourth quarter and the company reported a gain of almost $12 billion from its investment in electric vehicle company Rivian. Amazon shares popped as much as 14% Should the stock sustain this rally on Friday, it would be the biggest one-day gain since 2012. AMZN rising price of Prime by $20 on its more than 200mm subscribers. After the close on Friday, there was a report that Amazon was among the bidders for beaten up stock, Peloton which popped 35% on the news. Peloton is not yet running a formal sales process, but there is real interest in the company, a person familiar with the talks told CNBC.
This is a WSJ article entitled, “A Big Tech Trade is Losing Its Luster.” Given the focus on the sector I am including it. The FANG+ Index is -16 % from Mid-November highs, but up 5% from recent lows.
This was from Oppenheimer Research on Thursday and a great market summary of what took place in volatile trading. Between the BOE rate increase, the ECB hawkish pivot, technical resistance, and FB implosion we hardly had a chance today (the FB move was the biggest single day collapse in market value in stock market history-$237.6bn). SPY finished down 2.3%, QQQ down 4% (FB was 1.3% of that alone, AMZN was 50bps), IWM down 1.9%. Value and defensives outperformed while expensive and high realized volatility names were hardest hit (down ~4%+). In the S&P sectors that meant staples and healthcare led, while comm services, discretionary and info tech lagged considerably. The hawkishness out of Europe had treasury yields sharply higher but still within recent ranges. Hike odds increased a smidge, now pricing in a ~20% chance of 50bps in march, from ~12% yesterday (1.2 hikes vs 1.12 hikes yesterday) and 5 hikes by Dec rose to 87% from 73% yest. The US economic data was more or less inline, the Markit services and ISM services were both a slight touch better than expected but the trend remains lower from December levels. Markit services fell from 57.6 in Dec to 51.2 in Jan, and ISM from 62.3 in Dec to 59.9 in Jan.
I wrote about the Meta earnings miss and disappointing guidance, but upon further review, I found this discussion point quite surprising given the size of the impact of the iOS privacy change. Facebook parent Meta said on Wednesday that the privacy change Apple made to its iOS operating system last year will decrease the social media company’s sales this year by about $10 billion. “We believe the impact of iOS overall is a headwind on our business in 2022,” Meta CFO Dave Wehner said on a call with analysts after the company’s fourth-quarter earnings report. “It’s on the order of $10 billion, so it’s a pretty significant headwind for our business.” Facebook’s admission is the most concrete data point so far on the impact to the advertising industry of Apple’s App Tracking Transparency feature, which reduces targeting capabilities by limiting advertisers from accessing an iPhone user identifier. Apple first introduced the ATT feature in iOS 14.5, which was released for iPhones last year. It’s also included in iOS 15, which is running on 72% of modern iPhones, according to Apple. ATT consists of popups that ask users whether they want to be tracked when opening up an app. If the user says no, the app developer can no longer access the IDFA, a device ID that’s used to target and measure the effectiveness of online ads. $10bn in lost revenue a year is a massive number.
The jobs report surprised to the upside on Friday am showing 467k gain in payrolls, well ahead of the 150k estimate. Wages were +.7% for January and the unemployment rate was 4%. To be clear, I consider U6 unemployment more accurate than the widely used U3. The U-6 rate reveals the percentage of the labor force that is unemployed, underemployed, and discouraged from seeking jobs. This rate is currently 7.1% and is down from 22.9% in April 2020, which is still an improvement more impressive than I imagined it would be. The payroll data was a big upsize surprise, but this Forbes article entitled “Turning a Sow’s Ear Into A Silk Purse” suggests that substantial revisions mask what would otherwise have been a disappointment. If you believe the Forbes article, the employment data is not nearly as rosy as the reported numbers suggest. I have found the ADP data to have a fairly high correlation with the official BLS data and if anything ADP is slightly more optimistic. In January, ADP showed -301k relative to BLS of +467k. I lack the time to spend to analyze all the reasons for the difference, but this is something to keep an eye on in my opinion. The last chart is the ADP data which clearly shows a much different picture and suggests the Forbes article about seasonal adjustments may have validity. After nearly a year of screaming about inflation in virtually every Rosen Report, I am beginning to believe it will be far less of a story by the summer or before.
This is the latest five-thirty-eight poll on Biden’s popularity. Nate Silver worked for the NY Times and runs Five-Thirty-Eight. To me, he seems left of center and at best, he is center, so his poll below should be taken with more weight than a Fox Poll, despite the fact that Fox has Biden higher. The poll has Biden at 41.7% approve and 52.8% disapprove. He is on top of Trump and worse than any other President in recent history at this time in his Presidency and this is from a clear Democratic leaning pollster. The 2nd chart compares Biden to the 8 prior Presidents and it is not so pretty. I could not make the picture fit due to my crack tech team (me), but Johnson, Kennedy, Eisenhower and Truman all beat Biden handily as well. Personally, I do not believe Biden has done a very good job and the polls are reflective of his shortcomings (border, foreign policy, inflation/supply chain, crime, pandemic, failed agenda, infighting in the Democratic party, empty positions in federal government,…)
The Rosen family has not taken any real vacations in a couple years due to the pandemic. It is a shame as we enjoy travelling, and the kids will be out of the house in a few years. When I think about all that the pandemic has taken away from us, my blood boils. Of course, there are no consequences for China despite the lies, deaths, destruction and trillions spent. I have been given an ultimatum by my family that we must take some time away for spring break. I am notoriously frugal about my travel and spending a ridiculous amount on hotels makes me crazy. It appears we may be heading to the Dominican Republic for 5 days. When I saw the hotel prices, I almost had a nervous breakdown. The taxes and fees should be the total price! Serenity Now! This article is entitled, This could be the biggest spring break for travel in years. Here’s how to prepare for it. “A big mistake that travelers are making is thinking it is a buyer’s market,” says Limor Decter, a travel adviser with Embark Beyond. “Many think they can snag a last-minute deal with great value for spring break. That’s not the case for spring break this year.”
Interesting article I found on CNBC about remote work. For 18 months, I have consistently written that one of the biggest long term impacts of the pandemic will be work from home/work from anywhere, and this article suggests I was correct. The total global percentage of remote employees is expected to double in 2021, and 76% of employees worldwide say they want to continue to work from home. This trend isn’t likely to recede even in a post-Covid-19 world. Kate Lister, president of Global Workplace Analytics, estimates that by 2025, about 70% of the workforce will work remotely at least one business week each month.
This is a four minute video interview of a former NFL player, and the topic of discussion is single parent households and the impact on children. The statistics below are from the US Census Bureau. I also am attaching again, the 2 minute video from Marcus Wiley on his views of BLM and compelling statistics about children from single parent homes relative to dual parent homes. I personally agree with these conclusions and the statistics around fatherless homes is staggering in the wrong direction. After growing up without a father (died when I was young) I know how hard it is, but I was lucky. Unfortunately, most from fatherless households end up in a far different place than I did.
From Joe DiMaggio to Albert Einstein, Princess Diana to Victoria Beckham, watchmaker Patek Philippe has long been a celebrity favorite. But the Swiss brand's reputation has taken an unexpected turn in recent years. Namedropping luxury labels may be nothing new in hip-hop, but lyrical references to Patek Phillippe exploded in 2017. That year, one-third of the songs on the Billboard Hot 100 mentioned the brand, according to music website Genius. Travis Scott has rapped about his "two-tone Patek," Cardi B "flooded" hers with diamonds and Gucci Mane suggested that his was "gon' make this crooked judge try throw the book at me." Young Thug, Migos and Future have all mentioned their Patek Philippe timepieces, while Lil Uzi Vert has such affinity with the watchmaker that he released two tracks honoring it, "Patek" and "New Patek." I had no idea 1/3rd of songs in the Billboard Hot 100 mentioned Patek. Below is Drake’s emerald laden Nautilus watch and then Cardi B with a diamond crusted watch.
Given the Winter Olympics are currently being held in China, I thought it would be appropriate to include a story entitled, GOLD AT ANY COST-China’s horror Winter Olympics machine sees kids ‘beaten raw’ by coaches & athletes picked in chilling DNA selection. With a colossal population of 1.4billion, China has a sprawling state-backed operation which puts young athletes through brutal training regiments to prepare them for the world stage. The country approaches sport with a level of precision, planning and ruthlessness usually reserved for the battlefield. The system is rooted in the Soviet model, which saw sport as a way of attracting prestige for the Communist system. The state sends out scouts to hunt for tens of thousands of children for full-time training at more than 2,000 government-run sports schools. Tests for selection see kids being given brutal challenges such as press-ups, endurance running and bench presses that prioritize overall strength over specific skills. It has also been reported for the first time at the Winter Olympics, China will be using DNA testing to selection athletes for their physical attributes. Despite having a population well over 4 times larger than the US, using drugs, abusing kids and using DNA tests, the US still has absolutely crushed China and everyone else since 1980 (China started participating again). I am proud to be an American. How the committee allowed the games to be held in China is beyond me. I read it will be the “most hacked games of all time” with the Chinese government tracking, hacking, trying to use ransomware…. The US beats China in total medals since 1980 by a score of 2,934 to 696. Mic dropped. Additionally, I enjoyed this headline: ‘Genocide games’: NBC refuses to run ad critical of China by NBA’s Kanter, Florida congressman. Additionally, House Speaker Nancy Pelosi on Thursday warned U.S. athletes participating in the Beijing Winter Olympics not to risk angering a “ruthless” Chinese government. Let’s not forget the Dutch reporter, who was forcibly taken off the air by Chinese security guards (2nd picture). Look at the shock on the face of his colleague. The Opening Ceremony was filled with propaganda according to many articles including this Yahoo Sports piece. Remind me again of why the world allowed the games to be held in China given the atrocities and fake snow. In yet another Olympic issue, there is this headline: IOC under fire for conditions inside COVID isolation centers. I have no interest in these games held in China and the ratings of the opening ceremony were horrible.
Other Headlines
NBCUniversal Sells Out Super Bowl Ad Inventory, Hitting Record $7M For Some Spots
Offshore wind powerhouse Siemens Gamesa sees its value nearly halve in a year
Ukraine’s president says there will be a ‘full-scale’ war across Europe if Russia invades
Kyiv could fall in days with a huge civilian toll, U.S. assessments find
Article suggests 5mm could flee Ukraine if Russia invades. Suggests up to 50k civilian causalities in Ukraine.
Biden says IS leader killed during US raid in Syria
Supposedly, he was working undercover to rebuild the terror group and the US offered $10mm for info on him. Great job Biden. I have no problem with aggressive tactics against terrorists.
Michelle Obama: Democrats' 2024 'break glass in case of emergency' candidate
I think this would be good for the Democrats, as I do not see Biden or Harris as having a chance in 2024. However, I would be surprised if Michelle would run. I see a better chance of Hillary trying again.
Teen rapper charged with shooting NYPD cop in custody again for violating probation
On 1/30, I published a report and included this about the teen: “This individual (16 years old) chose to carry illegal guns twice,” Lynch said. “He chose to fight with and shoot a New York City police officer. There’s no reason to believe he won’t do the exact same thing when he’s out on the street tonight. Despite views from law enforcement, he was released only to be arrested within days. Adams, Bragg and the other woke people in NYC, you are not doing your job.
NYC thieves swarm upscale boutique in $50K afternoon robbery
The same store (Celine in Soho) lost $1.5mm in goods in 2020 due to theft. I wonder what happens when these people get caught? Bragg, is it a slap on the wrist or serious jail time? What prevents crime if there is no punishment for it?
TikTok user films NYC man who threatens to ‘slit her throat’ in Union Square
I lived 3 blocks from Union Square for 12 years, and when my son was little, we would go there to have him play chess with people and I would play backgammon. Never did I feel uncomfortable. Well, things change when leadership is horrific and crime has no consequences.
Brooklyn teacher makes anti-cop post as school holds fundraiser for fallen NYPD officers
No wonder more kids hate cops, it is being taught in schools by teachers who want to defund the police.
Susan Sarandon apologizes for ‘insensitive’ tweet comparing NYPD funeral to ‘fascism’
Read what she wrote. Sorry, an apology is not enough. Others have been cancelled for far less. Below was from Sarandon.
Cringe-worthy 'Jewish' fried chicken recipe by Whoopi Goldberg resurfaces
I contend Goldberg should have been fired. Many others have been fired for similar actions or lesser comments. Despite changing her name to a Jewish one to get attention, she sure likes to make disparaging remarks about them.
Joe Rogan apologizes for repeated use of the N-word in viral clip
Joe has had a bad run as of late and I have zero tolerance for such language. He said, “We walked in to Planet of the Apes. We walked into Africa, dude. We walked in the door and there was no white people.” There should be some serious fall out here.
Stacey Abrams slammed for maskless pic surrounded by masked kids
Abrams, 48, joins many of her Democratic peers including California Gov. Gavin Newsom and San Francisco Mayor London Breed, who have been seen gallivanting indoors without masks despite supporting strict face-covering mandates. She later deleted the maskless picture. Everyone in the room (child and adult) other than Abrams had masks.
Undercover Mothers’ reveal how they’re fighting ‘wokeness’ in schools
Good grades barely matter in NYC’s new high school application process
This story makes me very upset and is frustrating for families of gifted kids with limited means. I do not like the direction of these mandates and rules. The impact will result in many children who should be in the gifted programs missing out as a result of the rules.
Teen Girls’ Sexy TikTok Videos Take a Mental-Health Toll
I fear the long term effects of social media on young people, especially young girls. This WSJ article is concerning. Parents need to pay close attention to posts. Son of a….
Woman 'gang raped' in VR Metaverse says tech advances made it feel like real life
FIU hospitality goes high tech with new robot bartender who can make 120 drinks/hour.
What are the ramifications of the rise of automation on the workforce? I would think 10 years from now, millions of jobs could be automated (driving, factory workers and countless others). The article sites the difficulty in finding workers.
CEO of CNN’s new owner calls network ‘leader in news to the left’
He attempted to walk back the comments, but we all know what he is saying.
Four of Boris Johnson’s top aides quit, while ‘Partygate’ scandal rocks Downing Street
Seven die and dozens poisoned after being ordered to ‘swallow battery fluid’ by doctors
Jeff Bezos’s New Superyacht to Force Dismantling of Dutch Bridge
Virus/Vaccine
Cases have plummeted as I suggested, but deaths remain sticky. Cases are -62% from the 1/15 peak and -57% from two weeks ago. According to NY Times data, only two states, Maine and Montana have seen case growth recently. Hospitalizations are -22% from the prior two weeks. Although, deaths are +21% and are 2,597/day, the growth rate is clearly slowing, and I believe numbers will start getting materially better quickly. The 7-day average of deaths appears to have peaked 2/2 at 2,660. To be fair, I did not believe the Omicron wave would result in as many as 2,600+ deaths/day.
As the U.S. inches up to a 64% vaccination rate for the entire population, only 42% of those eligible for a booster have gotten the extra shot, and experts aren’t sure what will move the needle, so to speak. Perhaps this will win over some converts: Fully vaccinated Americans are 14 times less likely to die of COVID-19 than those who haven’t gotten the shots. Boosted Americans are 97 times less likely. Those were the figures presented Wednesday by Dr. Rochelle Walensky, Director of the Centers for Disease Control and Prevention, based on reports from 25 jurisdictions in the week ending Dec. 4. For every 100,000 people, 9.7 of those who were unvaccinated were killed by the coronavirus, compared to 0.7 of those fully vaccinated and 0.1 of those boosted.
Israel scientists say they have gathered the most convincing evidence to date that increased vitamin D levels can help COVID-19 patients reduce the risk of serious illness or death. Researchers from Bar Ilan University and the Galilee Medical Center say that the vitamin has such a strong impact on disease severity that they can predict how people would fare if infected based on nothing more than their ages and vitamin D levels. Lacking vitamin D significantly increases danger levels, they concluded in newly peer-reviewed research published Thursday in the journal PLOS One.
Interesting CNN article about the effectiveness of Plexiglass barriers. Short video is worth a quick watch. The barriers reduces the concentration by 80% and reduces the distance of the droplets. The droplets can linger for 7-8 minutes. It also discusses the ineffectiveness of cloth masks.
Real Estate
The insanity persists down in South Florida on the R/E front with limited inventory. I just heard of yet another ridiculous story of a house on the water in Boca bought for $13mm less than two years ago. I am told, unsolicited, there is a $28mm offer on the house, but I don’t think a transaction is taking place. The demand for high-end, waterfront properties from Miami to Jupiter are off the charts and there is almost nothing on the market. Brokers tell me over 40% of high end homes sell off-market and are not ever listed.
Despite limited inventory, I understand that multiple new developments are going up in the Jupiter/Hobe Sound area which will see another 8 or 9 high-end golf courses and homes between Pascucci (Sabonack), Bakst (Friar’s), Meldman (Discovery), Jack Nicklaus (Panther National) and others. Given the land purchased, I presume we are talking about thousands of high-end homes in the next few years. Right now the market is starved. I do believe the migration north to Jupiter, Hobe Sound, Stuart will continue as that is where land is available and far more reasonably priced than Palm Beach, Boca, Miami. Also of note, I was just told GL homes received approval for 1,200 homes on 441 and Clintmore. They had tried getting 2,400 approved and failed. GL, also bought the old Boca Muni Course and are converting it to 500 homes. This is on Glades just west of the Turnpike. The move west continues and the success of Lotus, Boca Bridges, Seven Bridges and The Bridges is proof demand exists.
Jared Halpern from Elliman in NYC sent me a bunch of NYC info, but it is in PDF and I cannot figure out how to attach it. I am putting in a link to the Douglas Elliman Decade Report on NYC (2012-2021). There is a ton of incredible information on pricing, volumes, averages, medians…Too much to go over or include, but am putting in one chart about Manhattan.
A reader sent me this Financial Times story entitled, How Miami became the most important city in America as an interesting one. My long time readers know I have been talking up South Florida as a dream life and now even haters are realizing the benefits. Read the article. Investors are doing more business in South Florida now. It also goes into the new restaurants and bars. One part of the story is about Jack Abraham who is called, “patient zero” of the Miami migration. I was surprised by his reasons for moving and his success rate at getting people to join him. In June of 2020, the then-34-year-old Silicon Valley venture capitalist and entrepreneur was holed up in San Francisco. His New York buddies invited him for a week long vacation in Miami, where the weather was good and restaurants were open. He turned them down, afraid of getting Covid. They kept hounding him and, bored and lonely, he gave in. Within days of arriving in Miami, he caught the virus. His buddies felt guilty and stayed with him while he failed Covid test after Covid test. Unable to fly back until he tested negative, he hopped between whatever Airbnb rental houses he could book, seeing more sections of the city than he’d known existed. When he was finally about to return home after a month and a half, Abraham decided not to. “If you had asked me in the beginning of 2020, ‘What’s the probability of you moving to Florida?’, I would’ve given you a zero,” says Abraham. Nearly 20 of Abraham’s powerful friends have visited his house in the Venetian Islands. “If you think of Miami like a product, the conversion rate is extremely high,” he says, guessing up to 70 per cent of his guests extended their stay and then moved. And each of them brought friends. And they brought friends. Abraham didn’t move here because of money or safety. He doesn’t cite the lack of a state income tax compared with California’s top rate of 13.3 per cent. He says it wasn’t the low crime rate or the lack of homelessness. It was the optimism. Let me be clear, I moved from NYC to Boca Raton 5 years ago due to taxes, cost of living, quality of life, weather, crime, filth, homelessness, yard/pool for the kids, Jack’s golf, the ability to fish… and I have not regretted it for one second. My real estate trade which has my Park Avenue apt -20%+ and South Florida House +140% suggests I am not the only idiot who thinks this way.
This Bloomberg article is entitled, More Homes Than Ever Are Selling for $50mm. What’s Inside. Until very recently, they couldn’t. Over the past 20 years, homes have occasionally sold for more than $50 million, but they tended to be exceptions. Only one sold above that threshold in 2013; the next year saw a flurry of super-high-end sales, but in 2015, $50 million-plus sales fell again to only one, a $57.3 million oceanfront estate, also in East Hampton. In 2020, however, the U.S. luxury housing market, fueled by historically low interest rates and a roaring stock market, rose to unprecedented heights. And then it rose even higher. At least 42 residential properties sold for more than $50 million last year, about a 35% increase from the year before. Four of these properties were in the Hamptons. The pictures of the homes in the article are amazing. So many spectacular estates from Miami to Hawaii with listing prices.
Kapalua Resort-$59.5mm
Aspen-$51mm
A newly built compound in Woodside, Calif., is slated to come on the market for $110 million. That would make it the most expensive listing currently on the market in the affluent Bay Area enclave, according to listings website Zillow.
The new, Italian villa-style compound was just completed in the past few months and includes five separate buildings with roughly 20,000 square feet of living space, according to the listing agent, Scott Dancer of Compass. Mr. Dancer declined to comment on the identity of the seller, but property records and permits show the house was built by 890 MHR, LLC, a company tied to developer Rafi Bamdad. Mr. Bamdad declined to comment on the project. Although the house is not my style, it is very nice. The property was bought for $6.8mm in 2018. It is 30 miles from SFO, so you know there is no chance I would want to be in this neighborhood. Lots of good pictures in the link.