I Love Padel and Ross Berman
8-7-24
Opening Comments
My last piece was about my new friend, Shannon Briggs, the former heavyweight boxing champ. I called it, “Let’s Go Champ,” Shannon’s favorite line. I received a lot of good feedback on what he is trying to do to help under privileged kids in Brownsville, Brooklyn. The most opened links were pre-sex NDA’s and background checks and the link showing the picture of 7’1” Shaq and 4’8” Simone Biles together.
I sent out a short note Monday afternoon explaining what was driving the market turmoil. I called it, “The Road to Hell is Paved with Positive Carry,” and for those who want to learn more about the volatility, it is worth a quick look. It has some good charts too. Mike Cembalest from JPM wrote a great piece with amazing charts about the Yen Carry Trade and some other topics. It is here for your review. The charts below are from Michael’s piece.
Hacked
I noticed a charge on my credit card for airline tickets I did not purchase and in short order, there were 4 airline charges totaling over $2.5k. I called the card company and learned that, despite never losing my card and carrying a Ridge RFID protected wallet, the criminals were able to access my card. The card company believes it happened at a new gas station I used in the Hamptons. Criminals use card readers and are able to access your account. What is interesting is, despite cancelling the card and notifying the card company that these were fraudulent charges, I continued to get emails to check into flights I never booked. The amount of time I spent on the phone with the card company to rectify this situation was mind numbing. Yes, I had a conversation with someone in the Philippines who clearly did not understand the original issue. Serenity now!
Markets
Olympic Medal Count Population Adjusted
How the Ancient Egyptian Pyramids were Built
Incident on a NYC Subway with Me
10 Most Expensive Cities to Live in the World
Growing Florida Inventory
LA Building Fire Sale
Video of the Day-3i Market Update
I called up the 3i team to suggest I moderate a panel of 3 market experts on Tuesday in light of the carnage in the markets. It was meant to be a tactical discussion to explain what happened and where we may go from here. We were lucky to have my close friends and 3i members, Peter Boockvar, Alicia Levine and Alon Rosin give their perspectives. We covered markets, including volatility markets. These are very knowledgeable people in their field, and I always learn something from listening. I often cite their comments and thoughts in my Rosen Report. The audience asked amazing questions and felt as though we covered a lot of ground.
I Love Padel & Ross Berman
I met Ross Berman a few years ago when he was looking for a house in my community. I helped him find a beautiful house and we are neighbors. We have a group of 7 or 8 couples that get together for dinners, events, tennis with some regularity. We have a tennis chat where you just say, “Who wants to play tomorrow afternoon?” Generally, a few people respond, and we have some sort of fun game. We have a chat for everyone that shares news and information as to where people are going so we can get together frequently.
Well, a number of months ago, Ross kept asking me to play padel. I did not know the game or have any interest. I will be 55 in November and learning a new sport was not high on my priority list. I bet Ross asked me a half dozen times to play until finally I acquiesced, and I am so glad I did. I am now officially addicted. In March, I wrote a piece entitled, “My Favorite New Sport,” but then, I had only played a few times.
I can best describe padel as a cross between squash and tennis. You play doubles and the game is fast paced and exciting. It is the same scoring as tennis but the court is about 1/2 the size and has walls. If tennis is like checkers, this is three-dimensional chess. The ball must bounce into the wall. If it hits the wall first, it is out and your opponent gets the point. You can hit the ball once it bounces off the walls or fence. (the bounces off the fence are crazy). Lastly, you can hit the ball into the plexiglass to go over the net in the air. Check out the “Best Padel Points of 2023” by the pros. Big advantage to being up at the net. Wow, these guys are good.
The stroke is very different from tennis. In tennis, you hit with a lot of overspin and in padel, you cut everything, so it bounces before hitting the wall and then goes low rather than high.
I am so thankful that Ross introduced me to the game as it is a blast. I am playing 4-5 times a week in the Hamptons and have lost 6lbs and 1.5” on my waist. I do not know why, but I sweat a lot more playing an hour of padel than I do tennis. Maybe it is the lack of airflow given the plexiglass walls coupled with the Astroturf floor.
Either way, I love padel and Ross for introducing me to the game. I introduced my son to it a couple weeks ago and he is addicted, always asking “Dad, can you find us a padel game?” (for padel, you really need to play doubles, so it does require four people).
For perspective, there are 11 private padel courts in the Hamptons at people’s homes. By next summer there will be over 100. The growth is amazing. I highly recommend it. In the Hamptons, there are a handful of places to play. At Brisas in Wainscott, they have a great group of people who play and you can join as a member or play as a non-member at the three courts (going to 6 next season). I love the people, owners and vibe, down to the music. The two downsides are the courts face east/west (sun issues) and they drainage problems, which should be improved by next year. The Racket Lounge in Southampton is a larger facility with tennis, pickle and padel and also a far larger initiation fee. It is a “higher end” experience but does not have the depth of play relative to Brisas in my experience. The north/south facing courts make life easier from sun issues and I believe they are fixing up the courts in the offseason to make them even better. Both Brisas and the Racket Lounge are great places to improve your game. I believe over the next 24 months, you are going to see a lot of new facilities being built in many cities across the country.
In Florida, I know there are a ton of new courts going up, as the game is growing like wildfire. I have played pickleball for a total of 3 miserable minutes. If you are athletic, padel blows the doors off of pickle or tennis. Today, the downside is access and the fact that you need to play with four people. Thank you, Ross. I am so glad I finally agreed to play. It also goes to show that you can indeed show an old dog, new tricks. Leave your comfort zone and try new things. You never know!
Quick Bites
All non-bolded text below is excerpted from the cited articles. Bold are my thoughts.
After a rough finish to the week last week, we had another challenging time in markets with indices selling off 2.6-3.5% Monday. The Nasdaq and Russell 2000 were the big underperformers during the sell-off. On Wednesday, we saw a nice morning rally only to fade into the close. From the morning highs to the afternoon lows, we saw the S&P and Nasdaq fall 2-2.7% on Wednesday. After creating havoc, the Bank of Japan downplayed the chance of another near term-rate hike on Wednesday. Despite the recent rally, the Nikkei is still -10% over the past 5 days. Treasury yields were higher Wednesday after a rally in bonds during the recent carnage. The 2-year yield is now 4.00% and the 10-year is 3.95%.
A lot is made of how many medals each country wins in the Olympics. Although I obviously want the USA to win every event, I think we need to look at medals on a relative basis. For example, China is 4 times the size of the USA in terms of population. The USA is almost 13 times the population of Australia. Surely, we do not expect Australia to have more medals than China or the USA? The chart below shows the latest medal count and their population. On a population adjusted basis, the three clear winners thus far are Australia, Netherlands and France. China would be the big loser.
I have been fascinated by ancient Egypt since I was a child after my mom took me to see the King Tut exhibit at the Field Museum in Chicago in 1977. I vividly recall being in awe. I could not imagine how the ancient Egyptians built those pyramids without modern technology. This Telegraph article suggest dams found near pyramids funneled pressurized water into a shaft to form a hydraulic lift to raise the huge stones. It may seem unlikely in the middle of the desert, but water power could have helped the Egyptians build the pyramids, a new study suggests. A complex system of dams and channels has been uncovered near the Step Pyramid, which sits to the northwest of the ruins of Memphis at the Saqqara plateau. Experts believe that the arrangement was designed to funnel pressurized water into a shaft in the building site, creating a hydraulic lift that could raise the huge stones to the upper heights of the monolith. The Egyptians invented hydraulics, building water mills and intricate irrigation systems to keep their crops hydrated, but it was generally thought they used a series of ramps, levers and pulleys to construct the pyramids. What an amazing discovery thousands of years later, potentially explaining how those crafty Egyptians built the pyramids. Good pics in the piece explaining how it was done. Here is another take from the Post with amazing graphics.
NYC Subway Incident. I came to NYC on Tuesday afternoon to do my markets webinar with 3i (see video of the day). After the webinar, I went to Bungalow in the East Village for dinner. I will write about it later, but in short, it is AMAZING. Might be the best Indian food in NYC. It was pouring and I jumped on the “F” train on 2nd Ave and Houston to head to the Upper East Side after my meal at around 7pm. I just missed a train and was waiting on the platform when I heard screaming, but could not discern where it was coming from. I saw a man coming down the stairs to get on the platform and he was yelling the “N” word, suggesting he was being looked at because he was Black. I thought he was of Hispanic decent. He looked 5’7”and 145lbs and was wearing jeans and a black t-shirt. His boots stood out, as they were red in color. I had my umbrella ready in one hand and my metal wallet in the other. There were little kids around me with parents (clearly tourists). The deranged man, who looked older than his years, pulled out a knife and started screaming. The parents took the kids and ran and I stood there. Not sure why. Had he been 6’4” and 250lbs, I would have run too. He looked at me and continued to yell as he walked away screaming with a knife in his hand. I could not find an officer and did not see one the ENTIRE way from 2nd Avenue and Houston to the UES of NYC. Sorry folks, I have no interest in living in a city that does not protect its citizens. Policies matter. Who you vote for matters. Sadly, even if caught with a knife, nothing will happen to him. To be fair, I take the subway a lot and this is my first serious incident and I have been riding the subway for over 30 years. The worst part is when I tell this story, NYC residents are not surprised.
2024 Election
Democratic nominee Kamala Harris picked Tim Walz (Governor of MN) as her running mate. Waltz is quite progressive and his choice as VP makes a major statement as to the direction of the Democratic Party. This article goes over some of his major progressive policies and views. Walz still needs to introduce himself to many voters over the next 91 days. An NPR/PBS/Marist poll published Tuesday found that 71% of respondents said they had never heard of Walz, or did not have an opinion of him. Any candidate will have some issues. We know that Trump, Vance and Harris are all filled with problems. I did not believe Vance was the best choice for Trump and feel Walz is a disaster based on his performance as Governor and his progressive policies. He was arrested for a DUI. His handling of the George Floyd protests was awful. Walz believed in onerous lockdowns during the pandemic and there was largescale fraud of pandemic programs under his watch. If anyone were to look into Walz’s decades-long fixation on all things China, they should be concerned. According to this article, Walz quit the National Guard and his unit of 500 just before they were deployed to Iraq. There are no major issues where I stand with the “Squad” and Rep Jamaal Bowman is gushing over the Harris/Walz ticket. That should tell you where the Harris administration will stand on key issues. Even staunch Democrat, Chuck Todd, said, “Walz pick is a ‘yellow flag’, shows Harris may be easily controlled by far left.”
Trump possible target of Pakistani national charged in murder-for-hire plot
Virginia man is accused of making death threats against Kamala Harris
Ex-Trump White House officials, dozens of Republicans endorse Harris
Axelrod: Harris momentum leaning heavily on ‘irrational exuberance’
Harris says 'everybody needs to be woke' in unearthed clip spreading like wildfire on social media
How progressive is Tim Walz? Here’s where the Minnesota governor stands on key issues
I thought this was pretty funny in light of the fact that Trump is a convicted felon.
Israel/Middle East
Israel-Hamas war latest: Hezbollah says it launched a drone attack on northern Israel
U.S. personnel wounded in attack against base in Iraq, officials say
U.S. forces destroy multiple Houthi weapons, vehicles in past 24 hours
UN admits nine UNRWA staffers ‘may have been involved’ in Oct. 7 attack on Israel
Putin asks Iran to avoid civilian casualties in Israel response, sources say
Nearly 100 illegal immigrants on the terror watch list have been released into the United States during the Biden administration, while Border Patrol agents have encountered migrants on the watch list from dozens of different countries, a new House report is revealing.
CNN’s ‘Senior Investigations Reporter’ Posted That She ‘Hate[s] … Zionism’
Other Headlines
Jamie Dimon says he still sees a recession on the horizon
I believe the chance of a recession has gone up sharply in recent weeks.
Japan’s Nikkei sees best day since October 2008; logs record single-day jump in points
The popular ‘carry trade’ is unwinding — and economists fear Fed rate cuts could make matters worse
Biggest concern is the market sell-off becoming a ‘self-fulfilling prophecy,’ research firm warns
America may lose its economic exceptionalism because of the Fed, El-Erian warns
Consumer giants from Starbucks to General Mills have one big sales problem: China
US judge rules Google has monopoly on search in DOJ lawsuit
"The court reaches the following conclusion: Google is a monopolist, and it has acted as one to maintain its monopoly," Mehta wrote. I am not a lawyer, but I have been writing about the Google monopoly for years.
Just what we need during a major market sell-off, technical issues.
Uber reports better-than-expected earnings and revenue for second quarter
Palantir raises annual revenue forecast on AI strength; shares surge (+12%)
Reddit reports better-than-expected results for second quarter as digital ad market improves
Airbnb shares drop 14% on earnings miss as company warns of slowing U.S. demand
CVS slashes profit guidance, will cut $2 billion in expenses as insurance costs climb
Cori Bush becomes second 'Squad' member to lose 2024 primary as Democrats split over Israel
NYC ‘gateway’ and tourist destination overrun by mentally ill, drug abusers: ‘Humanitarian crisis’
Unstable, strung-out homeless weirdos have swarmed large parts of Manhattan’s West Side, littering streets with needles and menacing locals and tourists alike — and there’s no help in sight.
Female tourists shoved onto subway tracks by unhinged woman during nightmare NYC trip
Crook who broke into Calif. home armed with stake and rock fatally shot by the gun-toting homeowners
The 6’6” 270lb 17-year-old student (at the time) beat a teacher unconscious after the teacher took his Nintendo. The student also got 15 years probation, despite being autistic. In NYC, LA, San Fran or Chicago, he would never serve time. I think if you watch the video of him trying to kill the teacher you would agree he deserves jail.
The 90-second film that earned Timothée Chalamet $35 million – and could save Hollywood
I would have done it for less and have better hair.
Filipino gymnast Carlos Yulo gets ridiculous list of rewards for winning two Olympic golds
The list includes a 3 bedroom condo, 10mm pesos ($173k), $20k department store credit, unlimited entry to the local buffet, lifetime supply of ramen…
Woman horrified after nail salon asks for minimum 75% tip: ‘Out of control’
Great short video. The salon gave choices starting at 75% for a tip.
Real Estate
This CNBC article is entitled, “7 of the 10 most expensive cities to live in the world are in the United States—see the full list.” Yes, Miami and Palm Beach have become quite expensive, but don’t crack the top 10.
This post outlines growing inventory in the state of Florida that show +70% from last year. Clearly, affordability is playing a huge factor given massive price increases, higher rates and sky rocketing insurance costs. However, on the high-end, I do not see much inventory building. If priced fairly, high end Miami and Palm Beach properties sell fairly quickly.
An unidentified Chinese investor has picked up a 25-story office building in Downtown Los Angeles for $60 million. The mystery buyer bought 801 Tower, a 465,200-square-foot building at 801 South Figueroa Street, in South Park, the Commercial Observer reported, citing unidentified sources. At the time of sale, the building was 79% leased. The deal works out to $129 per square foot.
Barings purchased the building in 2014 for $178.2 million, or $383 per square foot. Late that year, New York Life Insurance provided a $100 million loan tied to the building.
© 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™ #707 ©Copyright 2024 Written By Eric Rosen.
Mr. Eric came here several times today but did not see any new articles published