Opening Comments
My last note was entitled, “Never Judge a Book By Its Cover,” about me trying to buy a fancy car when I looked young. The most opened links were fizzy drinks and your health and the 5 emotionally intelligent things to do within 5 minutes of meeting each other. I also had a review of the Michelin Star restaurant, Stubborn Seed, in my last note.
We have been using Eight Sleep for about 6 weeks and my wife said this to me last week- “I had the deepest, longest sleep in years last night. I never get 8 hours of sleep, but I am getting it now. Eight Sleep works!” I will admit that it took a couple of weeks for Jill to adjust and find the right temperature, which happens to be 17 degrees warmer than my side of the bed. Now that she has found it, she is sleeping much better. I have gained over 1.5 hours of sleep each night using Eight Sleep with my setting at 67 degrees. Many of my readers have happily switched to Eight Sleep and the company is offering a great holiday promotion. Until 12/14, with the code ROSEN, you will get $600 off Pod 4 Ultra when bundled. This article suggests poor sleep can could contribute to higher dementia risk.
I am in Newport Beach, CA speaking at a conference for Pennington Partners, a $3+bn multi-family office manager. I am on the advisory board and feel Pennington has some differentiated strategies for those interested in learning more. The company caters to uber wealthy clientele. When I landed, I am having lunch with my good friends, George and Callie, before heading to Pelican Hill. Early send due to travel. I fly back on the redeye Friday.
Markets
A $300bn Investment Mistake
Elementary School Teacher Making Millions
The Demise of Chegg
Ownership Matters
NY Billionaires Hurting and Leaving/South Florida the New Hot Spot
Commercial Property Loan Defaults Mounting
Austin, TX R/E Correction
Top 8 Cities to Consider for Reasonable Rent
Massive Saudi Arabia Mixed Use $50bn Project-Insane
Video of the Day-Janitor Given a Car by Students
We live in a world with too many negative headlines and this is such a touching story, so I wanted to share it. James Madison High School football players in Virginia befriended the custodian, Francis Apraku. Apparently, Apraku was always friendly and checking in on the boys. The boys asked their friend what he would choose if he could have one splurge. Apraku told them a “Jeep Wrangler.” Through fundraisers, the boys raised $222k for a Jeep Wrangler in just four months. The reaction of the custodian was priceless as he rolled on the floor and cried tears of joy. I love to see positive stories rather than all the atrocities taking place in the world.
Mainstream Media in Crisis
I have been critical of the media for years. The incredible bias has been concerning and troubling. Trying to find accurate, unbiased and non-narrative news on TV or print media has proven elusive. The legacy media has lied, covered up or just gotten so many major things wrong: Hunter Laptop, Steele Dossier, Russian Collusion, Covid origin, vaccine effectiveness/safety, Gaza hospital missile strike blamed on Israel, Dominion Voting, Pelosi’s husband’s attack, Sandy Hook, Biden’s cognitive demise, border crossings, crime statistics, and so much more. The suppression of facts and news also continued on YouTube (Alphabet), Facebook, Instagram (Meta), and, to a lesser extent, Microsoft. As a result, Americans’ trust in mass media has collapsed over the past 50 years.
I feel the decline of media is due to awful and biased reporting, lack of trust, and new alternatives that can lend themselves better to social media soundbites, as ADHD is pervasive. This excerpt from a Hollywood Reporter article (leans Left), “Media’s Crisis Point: It’s Losing Relevance and Scorned in Trump Era. A Reboot May Be Next,” is an eye-opening piece about the challenges the media faces today.
Former President Trump’s decisive victory Tuesday led to a shock wave that was felt in newsrooms across Washington, D.C., and New York. Everyone knew the polls were close and that a Trump win was a strong possibility, sure, but the scale of Trump’s win left one senior producer at a broadcast network stunned: “We are questioning our relevance right now,” they said Wednesday morning. It was a sentiment shared by former Sen. Claire McCaskill, who lamented on MSNBC‘s Morning Joe: “I think we have to acknowledge that Donald Trump knows our country better than we do.”
Indeed, there are blaring red warning signs for traditional media everywhere you look. Ratings for the broadcast and cable news channels saw steep declines in ratings from Nielsen (finals showed an average of 42.3 million people, down from nearly 57 million four years ago), with the lowest ratings in decades. The steepest drop was felt at CNN, which saw its numbers fall below MSNBC for the first election night since that channel launched nearly three decades ago. (A caveat: Network PR reps note that readership and viewership online spiked on Election Day, more in keeping with modern consumption patterns. But the value in someone watching a 20-second CNN clip on X or a stream on Roku Channel is much different than someone who tunes in on TV.)
On Tuesday night, Fox News host Sean Hannity declared “legacy media” to be “dead” once it became clear that Trump was on pace to win.
This article outlines ratings for election night 2024 and shows Fox with 10.3mm viewers, MSNBC with 6mm and CNN with 5.1mm. All were down from 2020 levels. Overall, election night ratings fell 25% from 2020 numbers across 18 networks (56.9mm in 2020 and 42mm in 2024). CNN is firing top stars in layoffs given ratings continue to tank. MSN ratings are plunging as well.
Meantime, 84mm total streaming hours were watched on the election, with YouTube receiving 80.6% of it, and the power of non-traditional media - podcasts, Instagram, Twitter and Substack - have exploded. I believe Musk’s purchase of Twitter for $44bn changed the landscape of social media and gave Republicans a platform and voice after being blocked by other major social media and technology outlets. The power of Joe Rogan also cannot be denied. Over 26mm people watched Rogan/Trump on YouTube within the first 24 hours and within days, viewership hit 33mm+. It’s worth noting that both Musk and Rogan identified more with Democrats prior to this election.
I also love the All-In Podcast because the hosts are both Democrat and Republican, so you get balanced views and fair interviews relative to legacy media. During the election, they did a great job of interviewing ALL candidates who agreed to be on the show (Biden and Harris refused). In this week’s post-election episode, they also did a great job of discussing the issues with the election and “Legacy Media.” “Call Her Daddy” host, Alex Cooper has allegedly exploded in popularity and importance as well. Disturbingly, although it has emerged we now know that the Harris campaign paid “Call Her Daddy” Cooper $1m to appear interview Harris on “Call Her Daddy,” without disclosing it to the listeners. My personal view is the Rogan/Musk interview and unpaid endorsements by them in favor of Trump held far more weight than Harris’ paid celebrity endorsements.
Legacy media has a decision to make. Crying on air when your candidate loses does not show a lack of bias. Vilifying people for who they support will not win you a wide viewership. Lying about a candidate you like to protect them or lying about a candidate you don’t like to hurt them does not build trust with viewers. Refusing to correct false statements or admit errors reduces your viewer’s confidence in your reporting. In a recent incident, the NYT has yet to issue a correction for wrongly claiming Trump “falsely” accused FEMA of avoiding supporter’s storm-ravaged homes.
The legacy media has a long way to go and I am not convinced we will ever get back to the 1970s when Walter Cronkite, “the most trusted man in America,” was king and trust in media was soaring. Cronkite had a 78% approval rating, despite being liberal. To be fair, there was far less competition 50 years ago.
For all these reasons, I am hopeful that, with your support, we can continue to grow the Rosen Report and make a bigger impact. I am not always right, but when I am wrong, I correct my errors immediately and admit fault. I try to be balanced and call balls and strikes. I just want sanity to prevail and America to win and have some fun along the way. No matter where you fall on the political spectrum, please know I genuinely appreciate your interest and time, Thank you for reading.
Quick Bites
The market has sent a resounding message around the election and stocks remain at or near all-time highs. TSLA was up approximately 35% since the election as of Tuesday. Crypto has been on a tear since the election and hit $92k on Wednesday after being at $16k less than 2 years ago. At one point, my crypto exposure was -75%, and today I am up handsomely. However, the rate market is getting concerning. The 10-year is now at 4.45%or +85bps since the 50bps Fed rate cut. The result of the move in rates coupled with the rally in stocks is making equities less attractive (2nd chart). The last chart shows the S&P PE ratio which is approaching 1999 levels.
We have all made investment mistakes. Ronald Wayne was a senior designer at Atari who was asked by Steve Jobs and Steve Wozniak to be a 10% founder of Apple in 1976. Then Jobs and Wozniak each owned 45%. Ronald Wayne sold his 10% stake in Apple in 1976 for $800. Yes, you read that right, $800 dollars. Wayne was worried about the personal liability of the Apple investment and sold it. Had he held it, he would be the richest person in the world at over $330mm. In 1985, Apple stock was the equivalent of 13 cents and it is $226 now.
If you are on top of your game in virtually any industry, you can make a great deal of money. The best people in finance, medicine, law, business, entertainment, and sports make many millions or more. However, even plumbers, electricians, builders, HVAC are making real money and building substantial businesses. I recently wrote about an article calling plumbers and HVAC the new millionaires. One generally does not view teaching elementary school as a 7-figure opportunity, but Lisa Collum found a way to profit from her unique skills. Her teaching style helped her students ace state exams by going from a 38% to a 95% pass rate in one year. The teacher wrote curricula, “Top Score Writing” and started selling them to schools across America. Today, she is the CEO of Top Score Writing, which sells K-12 materials and consulting services. Her company now has six full-time employees, 10 part-time staffers and nearly $1.9mm in annual profit.
Here’s an interesting story about a once-high-flying stock called Chegg: The online education company was, for many years, the go-to source for students who wanted help with their homework, or a potential tool for plagiarism. The shift to virtual learning during the pandemic sent subscriptions and its stock price to record highs. Then came ChatGPT. Suddenly students had a free alternative to the answers Chegg spent years developing with thousands of contractors in India. Instead of “Chegging” the solution, they began canceling their subscriptions and plugging questions into chatbots. Since ChatGPT’s launch, Chegg has lost more than half a million subscribers who pay up to $19.95 a month for prewritten answers to textbook questions and on-demand help from experts. Its stock is down 99% from early 2021, erasing some $14.5 billion of market value. What is the lesson here? Just because you are a great company today does not mean you will be a great company tomorrow; you must constantly innovate. "I predict one day Amazon will fail. Amazon will go bankrupt," Bezos said, as recorded in the meeting and heard by CNBC. He explained that the lifespans of large companies typically span 30-plus years, not 100-plus years.
Ownership matters. This WaPo story, “Business is booming again for Washington’s "sleeping giant” NFL franchise, is about savvy business man Josh Harris, the new owner of the Commanders. He also owns NBAs 76ers and the NJ Devils. He worked at Drexel and was a co-founder of Apollo before leaving to run his family office. He has an estimated net worth of $9.3bn making him #112 on the Forbes list. Prior Commanders owner Daniel Snyder was a divisive figure and Harris has come in guns-a-blazing to fix the mess. But now, the Commanders are 7-3, thanks to their exciting young quarterback, dynamic offense and new owner, Josh Harris, who has invested millions since purchasing the team last year. The franchise that was a perennial disappointment is working its way back to becoming must-see entertainment — and rediscovering some of the perks that come with it. The first time I met Harris was in 1997 when I moved to NYC and his then-girlfriend, Marjorie, invited me to Passover dinner (I had known Marjorie since 1994, when we were trading loans). Years later, our kids went to nursery school together, as well. Harris moved to Miami just like so many other billionaires and runs his family office from there. Ownership matters and Harris is showing NFL owners how it is done in short order.
Election
As discussed above, the All-In Podcast is made up of four co-hosts that have political spectrum diversity. A lot of what I have been discussing around the election and why the Democrats lost handily was discussed in last week’s episode. Yes, it is long, but I agree with 85% of what was discussed in this podcast and have said much of it in this newsletter. Check it out.
I am very excited about these appointments. I believe they will save hundreds of billions and shrink the government. However, they appear to be consultants which will mean Congress will need to vote on these suggestions. I have written extensively about waste and the growth of big government. It is absolutely disgusting. I am sure there is an easy $500bn laying around. Not sure you can get to $2 trillion on a $6.3 trillion budget.
‘Prime Minister Vance’ set to be most powerful VP since Cheney
Trump names former top immigration enforcement official Tom Homan as ‘border czar’
Articles suggest he is an advocate to deport illegal immigrants. It will be interesting to see how this plays out. Seems to me that 300,000 illegal crossings/month will be a thing of the past.
44% of Californians voted for Trump. Awful policies on immigration, crime, homelessness, anti-business, energy, taxes, and woke teachings have all lead to the shift right by citizens. More are voting with their feet and heading to Texas and Florida, as well.
I have been incredibly critical of the Fed and their catastrophic mistakes by Greenspan, Bernanke, Yellen and Powell. However, I do not believe the President should meddle into rate decisions.
Chuck Schumer Embraces Election Denialism By Denying GOP Winner Access to Senate Orientation
Ultra-wealthy Democrats race to buy London boltholes after Trump win
‘No time to pull punches’: is a civil war on the horizon for the Democratic party?
Not confidence builders from an election integrity perspective.
Israel/Middle East
Israel’s Netanyahu acknowledges pager attack, says he sees ‘eye-to-eye’ with Trump on Iran
Iraq slashes legal age of consent to nine years old – so old men can marry young children
Iraqi leadership hates Jews, hates the West and hates women and little girls. Sad. Could you imagine your 9-year-old daughter getting married?
Scary pictures in the link. Israel will continue to pound the terrorists and Trump will help them more than the current administration.
This short video was from shortly after October 7th and shows Palestinians in Gaza cheering and celebrating as a 24 year old hostage, Matan Zanguaker, was kidnapped. Disgusting.
Arab, North African gangs set tram alight in Amsterdam while chanting antisemitic slogans
Columbia University students plan anti-Veterans Day protest to honor ‘martyrs’ of US ‘war machine’
NOTHING could get me to allow either of our children to apply to Columbia. I gave my kids a “Do Not Apply” list of schools. Watch this Harvard Video.
Judge approves antisemitism 'deliberate indifference' lawsuit against Harvard, second since summer
Other Headlines
In my last note, I included a headline about a man who tried to kidnap a child from the hands of a Jewish parent. It would be any parent’s worst nightmare. The kidnapper was apprehended and in a shocker, has 30 prior arrests. The system is broken and progressive crime policies do not work. This is just one of the reasons the election was a blowout. Watch the 4 second video.
Annual inflation rate hit 2.6% in October, meeting expectations
Hedge Funds Shorting Tesla Just Lost More Than $5 Billion
Since October 23rd, TSLA stock is +53% ($213 to $328/share).
I have written extensively about the consumer and lack of fiscal responsibility. Check out the chart below on savings.
Kids packing heat in NYC: Number of teens arrested with guns rises for sixth straight year
In 2018, 180 juveniles were arrested for guns, in 2021, 391 were arrested and in 2024, 427.
Justice Sonia Sotomayor Is Expected to Remain on Supreme Court
This Texas city is the No. 1 college town in the U.S.—here are the top 10
It’s 10am and Dad’s Doing Jell-O Shots. Must Be Parents’ Weekend.
Fall tradition at colleges used to be a time for campus tours and welcome speeches. Now parents want to party
Jake Paul 'contract clause' theory emerges ahead of Mike Tyson fight and it could change everything
The fight is Friday. The article suggests there may be a clause in the contract preventing Paul from losing. I hope Paul gets knocked out.
German politician resigns after sex doll post with Nazi logo
Real Estate
I have written about the Great Migration for almost five years and was an early adopter by moving in 2017. This NY Post article, “NY lost 9 billionaires this year — here’s how their absence is bad news for every New Yorker,” comes at it from a different perspective. It outlines the shrinking fortunes of 9 billionaires and the impact lower revenues has on the city. Many wealthy people have left NYC in the past 5 years, crushing the income and sales tax revenues for the city and state, while expenses have ballooned. “This is extremely volatile revenue that can dry up quickly and with little warning,” said Ken Girardin, research director for the Empire Center for Public Policy. “New York operates costly and inefficient public schools, Medicaid and mass transit systems that have grown accustomed not only to spending that income, but for that income to continue growing,” he said. Girardin warned: “Albany will eventually face a painful reckoning as the political class keeps demanding more revenue from taxpayers rather than better outputs from its own operations.” Couple that article with this one, “Move over LA and NYC – with Trump’s re-election, South Florida is now the political, business and celeb capital of the US”- and you can assume more flows of wealthy people are coming my way. I do feel Trump’s win will bring more of his inner circle to South Florida and many of those tend to be uber-wealthy. Another story shows blue states losing out to “vibrant” lower-cost regions as the migration continues. On the positive front, Trump promised to bring back the State and Local Tax (SALT) deduction, which will save citizens money in higher tax states.
According to FT, U.S. banks are increasingly exposed to risk from a surge in "double defaults" on commercial property loans, raising concerns that the "extend and pretend" practice may be concealing a deeper systemic problem.
Under fire: Banks have employed "extend and pretend" tactics to modify loans, deferring potential losses and helping borrowers avoid immediate default by offering temporary relief. This has allowed banks to avoid writedowns, but some industry experts, including Ivan Cilik of Baker Tilly, warn that continued high interest rates could make this relief insufficient, potentially leading to unsustainable debt levels. Regulatory concerns: Federal Reserve researchers are sounding the alarm, noting that lenient modifications in recent years could misallocate credit and increase financial instability.
This Daily Mail article, “Thriving music city that's now 'ground zero' for a property market crash,” outlines housing woes in Austin, TX. The value of houses in the city are down a 20% since their pandemic peak, Nick Gerli, CEO of real estate data platform Reventure App, said. Meanwhile, he says the number of homes for sale is on the up. 'Listings are now over 10,000, compared to 7,000 before the pandemic,' he wrote. 'Texas housing supply has spiked to the highest level since at least 2017.' Active listings are up 25% year-on-year, and 263% from the pandemic low.
The rising cost of rent is pushing people across the country to seek out cheaper areas, according to an October report from the Bank of America Institute.
The institute’s report identified the top eight cities where people are moving for lower rent based on a group of customers who had open consumer checking, savings, credit, and/or other investment accounts for every quarter between Q4 2020 and Q3 2024. The CNBC article outlines some prices. I just don’t think Cleveland, OH is a place I would live despite the average rent of $1,559/month.
The world’s largest building, “The Mukaab’” broke ground in Riyadh, Saudi Arabia. The Mukaab will cost $50 billion, and will be roughly the size of 20 Empire State Buildings. The pictures are ridiculous. The project will contain over 100,000 residential units and 9,000 hotel rooms, as well as more than 10 million square-feet of shops and 15 million square-feet of office space. Let me put this into perspective. Central Park Tower is the largest residential building in NYC at 1.3mm square feet with 179 condos. Downtown Miami has a total of approximately 14mm square feet of office space. The Mukaab is just enormous.
© 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™ #734 ©Copyright 2024 Written By Eric Rosen.
