Opening Comments
Picture of the Day-Flying Dinosaur
Music & Memories-What Happened to Christine?
Quick Bites
Markets, CPI, Job Openings/Scarcity of Labor/Shake Shack
Infrastructure Bill Passed, Amex CRT Training, Cuomo Gone
Oregon Education Bill, Black Realtor/Family Mistakenly Handcuffed
Chicago Violence, DeSantis on Masks in Schools/Obama/Tlaib
How Much To Retire by Age, NYC Tutor Craziness for Ivy
Crazy Olympic Stats, White Population Decline in US
Virus/Vaccine
Data
Gottlieb on Covid
Famous Epidemiologist ”Closer to the beginning than the end.”
Covid by State
Florida Data
JPM-Cembalest on Delta Variant
Real Estate-Lots of examples today with links/pictures
My general comments
Examples of recent deals in Miami, Boca and Palm Beach (pictures)
Calvin Klein sold East Hampton Estate for $85mm
New Starwood Office Complex in Miami-WOW.
Opening Comments
I am amazed by the condition of a professional athlete, especially as I get older and cannot do what I once was able to do. Despite believing I was in good shape, clearly, that is not the case. I am also not very bright. I decided to take a tennis lesson at 1pm on Monday in the heat of the day with a heat index in the mid 90s, but to me, felt even hotter. Remember, pro tennis players play 5 hour matches in 100+ degree heat and do it every other day. I was yet again huffing and puffing like a smoker. I lasted 55 minutes and called it as my forehands were barely getting over the net and I had drunk all the water in site. I was soaked and embarrassed at my effort and realize just how impressive professionals are at their sport. No, don’t ask about my backhand. I was so tired, a 97 year-old with two fake hips could have hit them harder than I could by the 45-minute mark. I hope no one was taking any video of this horrific display of tennis. Because the definition of insanity is doing the same thing and expecting a different outcome, I played tennis again at 3pm in the heat. I went in with lower expections and it was actually less humiliating today.
I have heard from multiple readers that back to the office has been pushed off by more companies as the Delta variant surges. This is a big step back for commercial landlords in major cities and will do more damage to an already weak system. One landlord I had spoken with was at 8% at the lows, 30% at recent highs and was hoping to be 60%+ by year end. This does not appear to be the case with Delta. More companies are requiring vaccines and masks as well. CA teachers must be vaccinated or get tested weekly. Most of the college kids I spoke with were required to be double vaccinated before coming back to campus.
For some reason, spell check is not working. I am sure there are errors today. Apologies. I am clearly far too relaint on spell check.
Jack and I are taking Fred (93 year old from “Getting Old is For the Birds” story) and his daughter to dinner tonight.
Picture of the Day-Flying Dinosaur
According to this CNN article, there was once a species of terrifying "dragon" flying over Australia 105 million years ago, according to new research. The fossil of a pterosaur with a nearly 30-foot (7-meter) wingspan once belonged to Australia's largest flying reptile. A study on these findings published Monday in the Journal of Vertebrate Paleontology. The pterosaur likely soared over a large inland sea that once covered much of outback Queensland, known as the Eromanga Inland Sea. Its spear-like mouth was perfect for plucking fish from the sea. "It's the closest thing we have to a real-life dragon," said Tim Richards (University of Queensland postdoctoral student in the School of Biological Sciences' Dinosaur Lab), also the lead study author, in a statement. "It was essentially just a skull with a long neck, bolted on a pair of long wings. This thing would have been quite savage. It would have cast a great shadow over some quivering little dinosaur that wouldn't have heard it until it was too late." I don’t know about my Rosen Report readers, but if I were walking down the street and this thing came down at me I would make Usain Bolt look slow and I would soil myself while running quickly. There are many reasons I am thankful for not living 100mm years ago and Pterosaur is one of them. Others include AC, refrigerators, the wheel, toothpaste, soft sheets, Charmin, and hot showers. However the fishing would have been insane back then assuming I had a pole with line, hook, and a reel.
Music & Memories-What Happened to Christine?
I love music and although I enjoy a wide spectrum of genres I like including, classic rock, rap, hip hop, Motown, Jazz, I always go back to classic rock and play it on the guitar. Like so many others, music has a remarkable way of bringing me back in time. I can hear a song and remember where I was when I heard it as a kid. This article from Psychology Today explains why music brings back such vivid memories.
Today, I am going to tell stories of music and memories songs bring up for me. As I have mentioned, my sisters were 9 and 10 years+ older than me and growing up in the 70s, I was listening to my sisters’ music as they controlled the radio and record player. It was Bob Seger, Steely Dan, The Eagles, Elton John, Billy Joel, the Stones, Queen, Chicago, Aerosmith, Fleetwood Mac…
When my older sister, Shelley, was in high school, she had a close friend named Bob who was a great guitarist. He would come over and play Steely Dan tunes. I was 6 or 7 years old and just thought Bob was Steely Dan. It was not until much later in life that I realized Bob was not Steely Dan when I saw Donald Fagen, the real lead of the band on TV. Every time I hear “Hey Nineteen” or any other Steely Dan tune, I think of Bob. The origin of the name of the band is hysterical, but not for the Rosen Report newsletter.
When I was in 5th grade, I had a girlfriend named Christine. I am pretty sure I was in love with her at the ripe old age of 10. At the end of the year, she was off to a different middle school than I, and she called to tell me we were breaking up. I was devastated and crying hysterically, convinced I would never find another Christine. I turned on the radio and the REO Speedwagon song, “Keep on Loving You” came on. Well, its 42 years later and when that damn song comes on, I am reminded of being dumped for the 1st time and crying in my garage convinced my life was over. Thanks Christine. I learned that this outcome would only happen 200 more times over the years. I also learned shortly after being dumped, she was dating my friend, Paul, who went to her middle school. Thank goodness there was no social media back then or I would have been incredibly depressed having to see pictures of my old girlfriend with my former pal.
My sister, Debbie loved Chicago (Peter Cetera) and Billy Joel. I vividly remember her laying out in the sun with aluminum foil wrapped around her Chicago album cover, shining on her face. Any time I hear a Chicago song, especially “Saturday in the Park,” or “25 or 6 to 4” I am reminded of my first concert ever, Chicago, with my Sister, Debbie. She also loved Billy Joel, one of my all-time favorites. I play “Only the Good Die Young” on guitar. I believe his best stuff is from the 1970s and VERY early 80s. To me, marrying Christie Brinkley led to his downfall. After that, I am not convinced he wrote many good songs.
One of my favorite movies of all time is called, “Arthur” with Dudley Moore and Liza Minelli. Don’t give me any of the crap remakes with bad actors. In the movie, there was a Christopher Cross song called, “Arthur’s Theme Song.” Anytime I hear it, I am reminded of the movie and just start laughing. Coincidentally, Cross came to Boca (yeah, he ain’t on top of the billboard charts anymore) and I went to his concert with maybe 150 people. His voice was about a 3 out of 10, but when this song came on, I was belting it better than him. In one song, he stopped in the middle and decided to start again because it was so bad. It was actually sad.
I eventually overcame my angst after Christine dumped me and met a girl who was visiting a neighbor. I was 13 and she was 15 and she liked Duran Duran. I thought they were horrific, but she was cute, so I acted as though I LOVED Duran Duran. I liked her so much that I rode my bike 5 miles each way to buy her the album with my hard-earned money. It was their first album which was cleverly entitled, “Duran Duran,” and the first single was “Planet Earth.” Never been a Duran Duran fan, but acted like one for 10 days. I could not wait to get back to the classics.
I wrote a piece some months ago about my pizza delivery experience to Ted Nugent and 38 Special in the mid 80s. Of course, a high school girl was involved and she came with me to deliver the pizza and then go backstage with the bands. Let’s just say, it was a wild time for a couple 16 year olds. When I hear, “Hold On Loosely” by 38 Special or “Cat Scratch Fever” by Nugent, it brings me back to the concert with a dozen pizzas in hand with a blond girl with 80s rocker hair and too much makeup. Just plain funny.
In high school, one of my surfer friends was named, Joe. He was always borrowing money to buy things he didn’t need, which made no sense, and you had to ask 100x to get it back. He borrowed $20 again and instead of paying me back, he brought me to a Simple Minds concert. The song, “Don’t You Forget About Me,” by the Simple Minds was from the John Hughes movie, The Breakfast Club. It was one of many 1980s classics and anytime I hear the song, I am reminded of the movie and concert.
The other day, I was at the course and a massive tour bus pulled up and out came Darius Rucker (formerly Hootie and the Blowfish) and now his own band. I started laughing as I was reminded of a 1995 story after the big Hootie album came out. I was visiting my friend, Chris, when he was getting an MBA at Duke. He drove an old Chevy Trailblazer and it had a broken CD player. In it was the Hootie CD “Cracked View Mirror” and Chris would only allow the song, “Time” to play. In my three-day trip, I heard the song approximately 1500 times and wanted to shoot myself. I called up Chris to tell him about my Darius siting and we both started laughing about it.
Songs bring back memories and take me to another time in a nanosecond. I am sure many of my readers have similar stories when they hear old songs. Hope you enjoyed some of the links. No, please don’t send me “Keep on Loving You.” I wonder what happened to Christine? Maybe she is a reader of the Rosen Report?
Quick Bites
The Dow and the S&P 500 rose on Wednesday after inflation jumped, but not by quite as much as investors feared when stripping out volatile food and energy prices. The 30-stock Dow gained 220 points, or 0.6%, to 35,484 to close at a new record. The index was lifted by names like Caterpillar and Home Depot. The S&P 500 traded up 0.2% to 4,447, also notching an all-time high. The technology-heavy Nasdaq traded over 0.1% lower to 14,765. Bitcoin and crypto largely rallied. On 7/20, Bitcoin was sub $30k and now it is over $46k. The 10 Year Treasury is at 1.33%.
Prices that Americans pay for everyday goods and services accelerated in July, but about where economists had expected. Excluding energy and food, CPI rose by 0.3% last month, shy of economist expectations of a 0.4% increase and well below June’s rise of 0.9%. Used car prices, which rose rapidly between April and June, gained just 0.2% in July after a climb of more than 10% in the prior month. The Labor Department reported Wednesday that its consumer price index rose 5.4% in July from a year earlier, in line with June’s figure and matching the largest jump since August 2008.
The number of job openings in the U.S. economy jumped to more than 10 million in June, the highest on record, as the U.S. labor market continues a choppy recovery from last year’s economic shutdowns, the Labor Department said Monday. There were 10.1 million open jobs on the final day of June, the report said, up from 9.2 million in May. Economist polled by Dow Jones were expecting 9.1 million openings. The jump came as the quits rate increased while the layoffs and discharges rate was unchanged, reflecting increased bargaining power and employment options for workers.
Another Bloomberg article on wages and scarcity of labor. For the first time in decades, the American worker is finally in command when it comes time to talk money. There are tell-tale signs everywhere that this is so. Like the way some employers -- such as Kroger Co., Chipotle Mexican Grill Inc. and Under Armour Inc. -- are frantically pushing up hourly wages to try to retain employees. Or the way others -- like Starbucks Corp. and Drury Hotels -- are dangling hiring bonuses to entry-level applicants. Or the way CVS Health Corp. is no longer requiring job-seekers to have high-school diplomas. Or the way Dan Sacco, the owner of Your Pie restaurants in Iowa, is instructing his general managers to poach workers from rivals with offers of better hours and higher pay. I spoke with the regional manager of the Springhill Suites in PA and she told me on many nights, they are unable to clean the rooms due to staffing issues. Pay has been “substantially” increased and people won’t show up for work. She jokingly said, “I think there must be a serial killer on the lose as we have had a dozen people show up for work for one day and never return.” They have more room demand than they can satisify given the more stringent cleaning requirements. Many days, they are turning away guests because they cannot turn the rooms quickly enough.
Shake Shack is preparing to hike prices this year more than it usually does in an effort to fend off inflation and protect its bottom line. The New York-based burger chain’s chief financial office Katherine Fogertey said customers can expect to pay as much as 3 percent to 3.5 percent more for their food. The planned price hikes are “higher than the approximately 2 percent menu price [increase] we have historically taken at the end of most calendar years, and we’ll be evaluating the need for further price increases that might go into effect in 2022, depending on how the cost landscape evolves through the rest of the year.” Shake Shack has already raised prices three times in the past year, according to Eat This, Not That. In December, it hiked prices by 2 percent. In February, the company raised delivery prices through third-party delivery services by 5 percent, and then another 10 percent in the spring. One other point, we are seeing airline prices fall slightly as has retail spending due to the Delta Variant. Nothing massive, but wanted to mention it. People will go to less restaurants and shopping over fears of COVID-19.
Senate Republican Leader Mitch McConnell joined Democrats in passing the $1.2 trillion infrastructure bill on Tuesday. The bill moves to the Democratic-led House for consideration. House Speaker Nancy Pelosi has said she won't allow a vote on the $1.2 trillion infrastructure bill until the Democrats' $3.5 trillion filibuster-proof reconciliation bill passes. I wonder how many billions of pork are in the final bill? Vice President Kamala Harris announced on the Senate floor that the bill passed 69-30.
American Express, which made a $2.3 billion profit last quarter, invited the great-grandson of the Nation of Islam’s founder to tell its employees that capitalism is evil. It was part of the credit-card giant’s critical-race-theory training program, which asks workers to deconstruct their racial and sexual identities, then rank themselves on a hierarchy of “privilege.” At one high-profile “anti-racism” event, AmEx execs invited Khalil Muhammad — great-grandson of Nation of Islam founder Elijah Muhammad — to lecture on “race in corporate America.” He argued that the system of capitalism was founded on racism and that “racist logics and forms of domination” have shaped Western society from the Industrial Revolution to the present. This is going a bit too far in my opinion. Amex should become a not-for-profit if capitalism is so evil. The CEO was paid $24.2mm in 2020 or over 400x the average person. Capitalism sure is evil. Was Khalil Muhammad paid for his speaking engagement? According to this site, Muhammad charges $10-20k to speak at engagements. Not bad for an hour or two. No hypocrisy here. I feel corporate America is overdoing the lecturing. How many large corporations in America were complicit for not promoting women, minorities, or homosexuals for decades? Now they want to lecture the employees?
It’s over. Faced with universal demands for him to step down and clearly unable to govern, Gov. Andrew Cuomo did the only sane thing: He tendered his resignation. Good riddance, too. New York is far better off with him out of the picture. It was only a matter of time, of course. No one wanted him around anymore. If he hadn’t quit voluntarily, the Legislature would’ve booted him. Opposition to his continued tenure mushroomed not only because of the charges of sexual misconduct from numerous women, devastating as they were, or his deadly nursing home scandal — his efforts to damn his accusers and cover up the care home facts were added outrages. Finally, you did something right, Cuomo. You put nursing home patients in harm’s way, sexually harassed numerous women and then tried to hide facts around the nursing home deaths and denied the harassment allegations. Good luck to the new Governor, Kathy Hochul. As an aside, President Biden on Tuesday gave a stunning appraisal of Gov. Andrew Cuomo’s performance, saying that he did “a hell of a job” immediately following his resignation for sexually harassing subordinates. I am not so sure the families of nursing home patients, families of violent crime, small business owners or the women who he allegedly abused would agree with the President.
Gov. Kate Brown, the Oregon Democrat, signed a bill last month with little fanfare that drops the requirement that high school students prove proficiency in reading, writing or math, before graduation, a report said. Supporters of the bill insist that considering math and reading essential skills has been an unfair challenge for students who do not test well. Here we go again with participation trophies. Go to high school for four years and you cannot read, write or do math, but get your diploma. Preparing kids for a bright future in Oregon.
A Black realtor was showing a house to a Black man and his 15-year-old son in a Michigan suburb last week when they looked outside and saw police officers surrounding the property with their guns drawn. "I knew once they surrounded the home they were preparing for a standoff," the father, Roy Thorne, told CNN's Don Lemon Friday. "And so my instincts told me we need to get out of here, we need to get to where they can see that we're not a threat." A neighbor had called authorities, saying a suspect arrested at the property a week prior had returned to the scene, according to the Wyoming, Michigan, Department of Public Safety. But the caller was mistaken: The realtor, Eric Brown, was giving Thorne and his son Samuel a tour of the home in the community of Wyoming, just outside Grand Rapids, after scheduling the visit online the day before. Clearly, racism is not dead in America and stories like this one really sadden me. A Black family was just trying to buy a home and get mistaken for criminals. Sure does not sound like a neighborhood I would want to live in today. I can’t help to think of how scary it must have been for them and what was racing through their minds when all this took place.
More than two dozen Chicago police officers reportedly turned their backs when greeted by Mayor Lori Lightfoot late Saturday at the hospital where an officer remains in critical condition. Chicago Police Officer Ella French, 29, was shot and killed during a traffic stop Saturday night, while her partner fights for his life at the University of Chicago Medical Center. As Lightfoot visited the hospital about midnight Saturday, about 30 officers turned their backs to her when she approached them on the 7th floor, the Chicago Sun-Times reported Monday morning. Cops being targeted, dozens of citizens shot every week with countless murders and the cops are being vilified and not supported by the mayor of the Windy City. Lightfoot and DeBlasio are in a race to the bottom for worst mayor in America. Chicago seems to see 60-120 shootings every weekend. Year to date, 2,748 were shot in Chicago and every year, 2,500-4,000 are shot in the city. There were 105 murders in July and 498 YTD, more than any other city in the US. For those interested, I uncovered a website entitle, “heyjackass,” after contacting the author of an article about Chicago crime statistics. Despite the funny name, the stats of Chicago crime are nothing to laugh about. My sister, 62 years old, has always lived in Chicago and is now quite fearful given the constant crime and gunshots. Why people chose to live in Chicago today is beyond me and I lived there for 13 years of my life.
As Florida contends with a massive surge in COVID cases, Governor Ron DeSantis seems devoted to making it more difficult to stop the spread in public schools. On Monday, DeSantis issued a statement making clear that any school administrator who imposes a mask mandate, in violation of his executive order banning such rules, could face financial consequences. Specifically, he suggested that “the State Board of Education could move to withhold the salary of the district superintendent or school board members, as a narrowly tailored means to address the decision-makers who led to the violation of law.” I am a little surprised by this aggressive stance by the governor in light of the case explosion and impact the Delta variant has on kids relative to prior variants. If I am being intellectually honest as my loyal readers expect, I do not believe the crappy masks from Costco do a ton to protect you. Kids also will move them around and not cover mouths and noses. In speaking with doctors, you need far better quality masks which are fit for you. A loose mask won’t do a ton, but I would never suggest to impose financial consequences to schools who ask kids to wear masks. For perspective, on Monday, Florida had over 28k cases and was triple the next closest state, Texas with 12k cases or California with 11k. My daughter’s school has mandated masks. I know they are uncomfortable, but probably the right thing to do in light of what is going on in Florida. The school made comment that it is doing “in person only” at this time. It is quite comical that Obama threw a maskless party for his 60th bday with hundreds of A-listers packed on the dance floor. Separately, Rep. Rashida Tlaib danced maskless next to members of a large indoor crowd during a wedding in a county where the CDCguidance calls for indoor masking. The video comes on the same day that Tlaib was critical of Kentucky Sen. Rand Paul on social media after Paul shot a video encouraging Americans to resist new CDC guidelines. I am merely trying to call out the hypocrisy which takes place. I wanted to take Jack to Musik Fest in PA, but decided against it despite being outside given the risks with Delta. I would not attend a large party indoors today despite being vaccinated.
How much are you going to need to retire? Whatever your answer, there’s a good chance you’re low-balling it, experts say. According to a new survey from the Transamerica Center for Retirement Studies, half of millennials (born 1981 to 1996) believe that they’ll need $300,000 or less in savings to retire comfortably — a fraction of what most estimates say they’ll need. Gen X (born 1965 to 1980) and Gen Z (born 1997 to 2012) had slightly higher estimates for their retirement needs: The median guess for each group came in at $500,000. Boomers (born 1946 to 1964) had the highest median guess, at $750,000 — which makes sense, since many of them are near or at retirement, so they have a clearer picture of what their retirement needs will be. However, even that amount probably won’t be enough to retire on in comfort, experts say. “The estimated retirement savings for all workers are on the low side,” says Catherine Collinson, CEO and president of the Transamerica Institute, the parent foundation for the Center for Retirement Studies. “I’m concerned that they’re not thinking big enough in terms of in terms of how much somebody should save.” With rates at zero in perpetuity, inflation hot, housing on fire, it will be very hard to retire with $300k in my opinion.
Interesting article on NYC parents spending on tutors and to get kids into Ivy League schools. “The college-admissions process is the drawn-out Super Bowl of high-stakes parenting. There is winning and losing and nothing in between,” writes Blythe Grossberg, high end tutor. “There is endless strategy and conniving. And the outcome — which college a kid gets into — is a referendum on the entire season, meaning their entire upbringing.” The intense academic pressure on these children of the 1 percent — the average annual income of families at the private schools where she taught is around $750,000 — often begins when they have barely learned how to walk. There are funny stories in the article. I can tell you NYC is in a league of its own. Sure, there are a couple competitive schools in Florida, but nothing like NYC. I spoke with a NYC tutor company owner in NYC. She has seen parents spend $750k/year for 4 years to get their kids into the Ivy League college of their choice only to require another $150-200k/year in tutoring while in college given the kids cannot handle the academics. I am sorry folks, your kid should not be there. If you need to spend millions on tutoring, it is the wrong school in my opinion. I was livid when my daughter was 7 and living in NY. We had a math tutor in the Hamptons who charged $175 for 50 minutes to go to go to the tutor’s house to teach 3rd grade math. In Florida, they come to your house for $50 an hour for 7th grade math. The story outlines $800/hr tutors in NYC. I don’t know about you, but I just find it offensive. I don’t mind the idea of tutors for extra help. I do think effectively paying someone to write your papers and do your homework is wrong. If I had $100bn, I would not do this for my children. I would rather them go to a lesser school where they thrive. Yes, I am bothered by the insanity and feel it is wrong. Ok, I feel better now. My only hope is they do away with SAT/ACT due this this insanity.
This is an interesting article about 24 crazy stats from the Tokyo Olympics. Facts include ages of youngest medalist (12 pictured below) to countries first medals. For those folks who enjoy the Olympic games, this link is worth a quick look. Also, TV ratings were down 42% from Rio in 2016 and averaged 15.5mm primetime viewers.
Interesting statistics on US population growth. The number of white people in the US has declined for the first time in history while Hispanic and Asian populations grew, according to census report:
Aug. 12 report to reveal a drop in white population for the first time in U.S. history
Experts believe lower-than anticipated birthrates among millennials and the opioid epidemic attributed to the recent decline
The Hispanic population now represents about 20% of the population, while the Black population continues steadily at around 12.5%
Asian population has doubled since the 1990s and now represent 6%
Experts say there will no longer be a racial majority in the U.S. by 2045
The U.S. saw the smallest population growth this year, a trend since 2019
Virus/Vaccine
The good news is the case grow rates are slowing. The bad news is cases grew 86% in the prior two weeks and are back to 118k/day. For perspective, on 7/31 the growth rate was 148% and on 7/24 it was 172% for the previous two weeks to those specific dates. Hospitalizations are up sharply at +84% in the prior two weeks and are now back up to 66k, a level not seen in 7 months. Deaths are growing faster as well +102% for the prior two weeks and are averaging 608/day.
Former FDA Commissioner Dr. Scott Gottlieb warned that Northern US states could see COVID-19 cases rise as students return to the classroom. Gottlieb said the states may not have outbreaks that rival Southern hotspots such as Florida, but they are still vulnerable to climbing case numbers. “I think the Northern states are more impervious to the kind of spread we saw in the South, but they’re not completely impervious,” Gottlieb said on CBS’ “Face the Nation” on Sunday. “They have higher vaccination rates, there’s been more prior infection. But there’s still people who are vulnerable in those states.” Gottlieb said the return to school may drive case numbers up everywhere.
The pandemic is not coming to an end soon — given that only a small proportion of the world population has been vaccinated against Covid-19, a well-known epidemiologist told CNBC. Dr. Larry Brilliant, an epidemiologist who was part of the World Health Organization’s team that helped eradicate smallpox, said the delta variant of the coronavirus is “maybe the most contagious virus” ever. Still, only 15% of the world population has been vaccinated and more than 100 countries have inoculated less than 5% of their people, noted Brilliant. “I think we’re closer to the beginning than we are to the end [of the pandemic], and that’s not because the variant that we’re looking at right now is going to last that long,” said Brilliant, who is now the founder and CEO of a pandemic response consultancy, Pandefense Advisory. “Unless we vaccinate everyone in 200 plus countries, there will still be new variants,” he said, predicting that the coronavirus will eventually become a “forever virus” like influenza.
The U.S. Covid-19 wave that started in low-vaccination states in the Ozarks and Deep South has now engulfed the country, with cases and hospitalizations at their highest since February. Thirty-eight states have transmission levels considered high by the Centers for Disease Control and Prevention, meaning they’re posting at least 100 cases per 100,000 residents or have positivity rates of at least 10%. The other 12 states and the nation’s capital have transmission rates that are considered substantial, the second-worst category. The latest U.S. wave began in low-vaccination states. Intensive-care units are now swamped with virus patients in Florida, Louisiana and Mississippi. But the faster-spreading variant is finding its way even into states that outperformed in the vaccination campaign and have enforced strong mitigation measures. Twenty-three states and the nation’s capital have seen their seven-day average cases increase at least 50% in the past week, including such highly-vaccinated states as Vermont, Washington state and Hawaii, according to CDC data.
Bad data on Florida-Hospital beds are filling up in the meantime, with 86% of in-patient beds in use compared with 74% nationwide as of Wednesday, according to data compiled by the Department of Health and Human Services. Across the U.S., roughly 10% of all hospital beds are being used to treat Covid patients, while nearly 28% of the beds in Florida are occupied by them — the highest of any state, the data shows. Just over 90% of the state’s ICU beds were in use as of Wednesday, almost half of them filled with Covid patients, according to HHS data. Florida’s death toll is on the rise as well at a seven-day average of 88 daily Covid deaths, up 51% from last week but below the record average of more than 180 deaths per day in late January, according to Hopkins data.
Michael Cembalest on Delta Variant
Michael did a one hour video call today which was informative with fantastic charts. The link is here to the charts, but the video is not up yet. A few quick excerpts.
States/counties with the best vaccination rates have lower hospitaliztions.
States in the south are really underperforming (Louisiana, Florida, and Mississippi).
According to his charts, approximately 97% of hospitalized patients are unvaccinated.
The Delta variant viral load is 1000x higher than the originalSARS-CoV-2 variant.
Although risk of infection increases 6 months after vaccine, the protection against hospitalization remains strong.
Real Estate
A reader called me to ask me about various R/E markets in South Florida. I walked him through areas of Miami, Boca, Palm Beach and Jupiter. We looked at available inventory. All I can tell you is it is a seller’s market. I have never seen less inventory in my life. My educated reader friend was in shock at the prices and lack of homes for sale across the markets. The most desirable communities have between .5-2% of homes for sale. Historically, it is 8-10% in these places and much higher challenging times. Homes on North Bay Road in Miami, Royal Palm in Boca, Palm Beach Island, Old Palm or Admirals Cove in Jupiter have so little available. Many of the listings are junk or very over-priced and not real sellers. With the continued migration out of high tax states in the Northeast and Midwest, I just do not see any near term dips of any consequence with no inventory on the market. I stopped looking to move onto the water as I was spending too much time spinning my wheels. I am not a good buyer when you need to compete against 10 or more bidders and are forced to overpay. He asked where to go if you can spend $4-5mm. Below I have a great condo which just sold for $4.1 with the link. As is always the case, you need to make compromises in a hot market if you have a limited budget. Even if you want to spend $1mm, there is something to find; it just might not be near the water or in a new building if a condo. My wife spoke with somone who sold their new home for $20mm and the owner claimed they received a knock on the door with an offer they could not refuse. Off market transactions happen a great deal now.
The house listed in my neighborhood for $45mm had two showings yesterday. I can’t believe anyone would have any interest in an old house with marginal views. It is just not worth it, but with the wealthy coming down, anything is possible. I keep saying these homes won’t sell for such crazy prices and they end up sold. One of the top producing brokers in Palm Beach is Christain Angle and he posted that he sold $815mm YTD 2021 and is a one man show. He is making hedge fund money, cash! I presume he will make $40mm range this year. Not bad for a broker who takes no risk, works for himself and lives in Palm Beach. Some of the sold homes listed are $32-57mm.
My close friend, Devin Kay, sold a 7000 ft home on 1/3 rd of an acre (on water) in Miami for $12mm in Bay Harbor Islands. If that house was on North Bay Road, it would have probably gone for double that amount or more.
Devin sold another home on the intracoastal in Boca Raton for $8mm representing both sides and went under contract in 3 days. The lot is 15,000 ft. and the house is 10,000 ft. He also sold a 4,400 condo at Jade Ocean in Sunny Isles for $4.1mm. So, despite crazy market prices in some spots, a condo just traded for under $1000/ft in move in condition. The condo came with 4 contiguous parking spots as well.
I am told there is a PH at the MUSE in Sunny Isles which has been on the market for 18 months. It was originally listed at $19.5mm and is down to $13.5. It seems the building is a bit out of favor, but the unit looks amazing and reasonably priced and seems like the seller has more room as well.
A reader told me about a story in the Bridge in West Boca. I mean it is so far west, it is basically Naples. His friend bought a house in December for $960k and the same house next door just sold for $1.9mm. Only difference is the other house had a pool. These homes were 5,600 ft and new construction. Yes, this market is insane at every price point.
Calvin Klein has just sold off the last of his Hamptons real estate portfolio for a whopping $85 million. The nearly 8.5-acre spread was sold in two off-market transactions, according to Dirt, with the bulk of the estate going for $75 million. An undeveloped adjacent strip of land traded at $10 million. The famed fashion designer, 78, had purchased the East Hampton home back in 1987 from the son of Juan Trippe, the founder of Pan American World Airways, for only $3.6 million at the time with then-wife Kelly Rector. Shockingly, the IRR on the investment is only 9.7%. The power of compounding is real.
Miami Office Space
A reader sent me some info on the new Starwood (Barry Sternlicht) office building in Miami. I have stated before, Barry is a complete superstar. He is incredibly impressive. This project strikes gold again. He is getting $80/ft + $23/ft for common charges. No brokers, all direct leases and believe it is almost fully leased with delivery later this year. People are paying effectively over $100/ft in Miami. There is some allowance for buildout, but people are spending well in excess of allowance I am told. Miami is not accustomed to these prices. Yes, real people are moving down. I was told that many tenants are family offices. Although prime NYC office space trades higher than this new building, effectively $100/+ft. is a big number for Miami. Leave it to Barry to get top dollar. That guy is really knows his stuff.