Response Time
9-21-22
Opening Comments
My former partner-in-crime, Jeff, sent me instructions on how to connect my earbuds to my iPhone, so I can search for them when they inevitably go missing. If you lose them outside in South Florida this time of year, they may melt. I strongly advise staying away from July 15-Oct 15 if you can; the heat is brutal.
The day after my last post, “Lost Time,” I misplaced a check. When you shop at Costco, they send you a check for some rebate to be used only in the store. My wife refuses to go in person as her car gets dinged up there. I grabbed the check from my dresser, got in the car and somehow, the check did not make it with me. I tore apart everything for 30 minutes and found the damn thing on the desk in my office. More lost time I can never get back.
The inflation issue is impacting individuals and businesses. One golf club general manager told me that they lost four kitchen staff in August due to people leaving for substantial raises. Cooks can get over $25/hr now. I was with a gentleman who told me busboys at a high-end restaurant in South Florida can make up to $50/hr as the management could not keep them, and it was impacting the ability to turn the tables over. This CNBC article is on wages and being sticky as I suggested in prior months. When I went to Costco, I looked at organic butter. $16.29 for two 4-packs. Over $2/stick? I bought the grass fed for $9.69. With all the high prices, I may put my name in to bus tables. If you see me at a high-end restaurant cleaning a table, be sure to give me a nice tip.
Picture of the Day-Mullet Boy Championships
Response Time
Quick Bites
Markets
German Inflation/Energy-WOW
Bed Bath Stock
Blue vs. Red Cities and Dining
Wall Street Fines for WhatsApp
President Ages-What is Too Old?
Other Headlines
Crime Headlines
Virus/Vaccine
Data Improving
Real Estate
General Comments-Delaire Community Update
Miami High-End Remains Hot
Lower East Side of NYC Retail
Other Headlines
Home Prices Falling
Broken Renters Market
Huge Broker Fee for NYC Rent Stabilized Unit
Chinese Property Developers Losing
Picture of the Day-Mullet Boy Championships
I thought this was a fun article on the mullet boy championship. Traditionally the hairstyle has been described as “business in the front, and a party in the back” — but it’s clearly all “party” for the finalists of the 2022 USA Mullet Championship, the winner of which will be decided by voters this week. I just plain love this look. Last picture is me and my son, Jack, two years ago when he could have been a contender in the contest.
Response Time
I pride myself on being responsive to people personally and professionally. If someone calls, emails or texts, I try to count my response time in minutes, not days. I get frustrated when others don’t have the same view about following up in a reasonable manner. Some folks don’t have the same sense of urgency. I have always taken pride in my responsiveness to colleagues, clients, customers, investors…Every now and then I forget to check my spam folder and there is an older email in there I did not realize and I get angry I missed it.
I am writing today’s piece about response times given a former colleague from JPM reminded me about it. He worked in a support group when I was responsible for the Credit Trading business. I always made time for him and others who wanted to ask questions and did my best to be a mentor. If they wanted to learn and I could help, I made the time.
I have been gone from JPM for 12 years and during that period dozens of former colleagues have reached out for advice. This man has reached out to me for counsel on three occasions apparently (he told me this). We connected again Friday and he said, “Eric, I want to thank you for always making time for me. But what blows my mind is in the three times over the past 12 years I have reached out, you have always responded in less than 15 minutes. I can’t believe you would respond at all, but you are always available to help me so quickly.”
I have been this way for quite a long time, but something Jamie Dimon said in a senior meeting only made me tighter on the topic of response times. Jamie was frustrated that a senior person did not respond to a client email in what he felt was a responsible period of time. Jamie said, “I am the CEO of JPM and have hundreds of thousands of employees. If an employee, client or customer reaches out to me, they will get a response within 24 hours.” To this day, if I send Jamie an email, he responds quite quickly, and his responsiveness has only forced me to up my game.
I had another boss, John Steinhardt, who also was quick to respond. I remember sending him an email on a Saturday night around midnight, and sent back a note in 4 minutes answering my question. John ran a huge business at JPM, yet was always on top of things. I may not have always liked the answer, but he was decisive and responsive.
My point is simple, most people can do a better job of responding if folks like Jamie Dimon can do it, you can too. Also of note, I have expanded my time to mentor more high school, college and young professionals looking for career advice, resume preparation, interviewing skills and general information about working/careers. I have a lot of very accomplished readers on my distribution and would ask that you try to spend time as well. If anyone wants to make themselves available for the kids who come my way, email me at rosenreport@gmail.com and put “mentor” in the subject. If you can tell me your specialty or experience, I can contact you for help when my mentees need a specific expertise. All areas of expertise are welcome. I seem to have an endless flow of young people in search of assistance. The only ask I have of them is to pay it forward and help others as they move up the corporate ladder. Just last month, I helped get a reader a job by introducing him to another reader who I knew was looking.
Quick Bites
The S&P 500 slid 1.29% to close at 4,228, while the Dow tumbled 292 points, or 0.86%, to 33,707. The Nasdaq dropped 2.01% to settle at 12,705. For the week, the S&P edged 1.21% lower, while the Dow slipped 0.16%. The tech-heavy Nasdaq closed out the week down 2.62%. Friday’s halt in Wall Street’s summer rally came as minutes from the Federal Reserve’s July meeting and comments from St. Louis Federal Reserve President James Bullard indicated that the central bank would likely continue hiking rates in the near term, putting a damper on investors’ hopes of a slowdown. I have been personally surprised by the sharp bounce in the equity markets in recent weeks. I feel the Fed has a decent amount more to go despite the fact that we are seeing cracks in inflation. I am less constructive now, but do feel the US outperforms the basket given the issues in Europe and Asia. One partial explanation is the 1st chart which shows the GS most shorted stock basket relative to the S&P and you can see the massive out performance of the heavily shorted names. The shorts are +45% from June lows and S&P +15%. The 10-year Treasury is up to 2.97% and was 2.6% three weeks ago. Oil is back down to $90/barrel, but Natural Gas continues its upwards climb to $9.3MMBTU. Nat Gas is +70% in 6 weeks and + 154% YTD. Also of note, the dollar remains strong against the basket. For perspective, the Eur/USD was 1.12 in January and is parity (1.00) today. The 2nd chart shows the USD vs the DXY (basket of currencies EUR, JPY, GBP, CAD, SEK, CHF). The USD is +12.5% YTD against the basket of major currencies. This is a big move in a short time. Also, UK yields have gone up sharply in recent weeks, but the British Pound remains under pressure.
German producer prices jumped at the fastest pace on record in July, underscoring the gloomy outlook for Europe's largest economy, which is stuck in a stranglehold of soaring costs and weakening growth due to the Ukraine war. Producer prices -- a leading indicator for inflation -- surged 37.2% on the year, the biggest rise since records began in 1949, the federal statistics office said on Friday. The month-on-month rise, 5.3%, was also the highest on record and far surpassed expectations. Energy prices as a whole were up 105% compared with July 2021, due mainly to higher prices for natural gas and electricity, the office said. The irony here is these prices were driven by reliance on Russia and a desire for Germany to become “cleaner” on its energy usage. Instead, Germans will be burning coal and firewood all winter to prevent from freezing to death. Hate oil and natural gas all you want, we will be reliant on it for decades. Let the German debacle be a lesson. Energy independence is key and smartly adopting new cleaner technologies, while not vilifying oil and gas is the right way forward. The 2nd picture is an electric bill from an Italian company comparing July 2021 and July 2022 and shows an 8-fold increase. Trump warned the Germans in 2018 and they laughed at him (32 second video). Yes, the situation in Europe is an unmitigated disaster and should leave Merkel with a tarnished legacy.
Activist investor Ryan Cohen has exited his position in retailer Bed Bath & Beyond, according to a securities filing released Thursday afternoon. The stock fell over 41% on the day after rallying massively last week. The stock is -59% over the past year with substantial volatility along the way. These meme stocks are crazy and suggest anyone proceed with caution. Look at the volatility in the chart below and the viscous moves. If you invest in these meme stocks, size it accordingly and take some anti-nausea pills. You are in for a bumpy ride. 52-week range of $4.4 to $30.1!
Establishments in deep-blue cities that faced both excessive COVID-19 restrictions plus violent protests in 2020 are starved for diners, according to global data. The number of daily diners in the city of Minneapolis was down an average of 54.3% in July compared with July 2019, according to OpenTable. The state of Florida, meanwhile, has four of the top six surging cities in America. Las Vegas topped the list in July, with the daily number of diners up an average of 35.7% compared with July 2019. Sin City is followed by Fort Lauderdale (+34.0%), Miami (+32.8%), Austin (+27.3%), Naples (+25.4%), Tampa (+22.3%), Nashville (+19.2%), San Antonio (+18.6%), Scottsdale (+18.0%) and Phoenix (+14.3) as the top 10 cities with booming restaurant scenes this summer. The list of bottom 10 cities struggling to recover is rounded out by San Francisco (-45.9%), Portland (-45.2%), Seattle (-40.8%), Philadelphia (-39.2%), New York City (-37.9%), St. Louis (-28.2%), Washington D.C. (-27.3%), Baltimore (-24.9%) and Chicago (-22.8%). Policies matter. Harsh lockdowns and mandates kill business. Florida is thriving. I spoke with the owner of 100 barber shops in many states across the country. They closed 8 in CA because they cannot find help. Given the mandatory lockdowns, many people left CA and have not returned. CA and IL stores are performing the worst relative to Red states. In general, he is struggling to find help, but the Blue states are substantially under-performing relative to pre-pandemic levels.
Many of Wall Street’s biggest banks are nearing agreements to pay as much as $200 million each and admit that their employees’ use of personal messaging apps such as WhatsApp violated regulatory requirements, according to people familiar with the matter. If you recall, then Secretary of State, Hillary Clinton used her private email server for tens of thousands of emails and then deleted them AFTER she received a subpoena for them. No consequences. She said the deleted emails were personal in nature, but the FBI recovered 17,000 and many were work related. If it is found that Trump indeed violated the law by taking classified documents, I have no problem with him facing consequences. However, it would be nice to have some consistency.
The Iowa state fair attendees suggest Biden is “too old” to run in 2024 and inflation is a key concern in the vote. As a result, I wanted to again suggest age limits for the most powerful position in the world. I believe 70 years old at the time of inauguration should be the limit. The physical and mental demands to be the President must be incredibly taxing (see before and after pics). This link shows every President’s age at the inauguration and the average is 55 years. If Trump were to win in 2024, he would be 6 months older than Biden was when elected. Below are recent Presidents. 80, is just too old to be in office in my opinion. Don’t get me started on the House or Senate. It is even worse.
Other Headlines
Half of US companies gearing up for layoffs, survey suggests
The article is fairly bleak about upcoming layoffs and hiring.
Now Meta starts laying off workers! Facebook lays off 60 contractors who were told in conference
Turkey shocks markets with rate cut despite inflation near 80%
Generally with runaway inflation, you raise rates.
Inflation peaking? 10 common consumer items where prices are falling
Streaming overtakes cable and broadcast in TV viewership for first time
Twitter Becomes a Tool of Government Censorship
Alex Berenson was kicked off the site at the White House’s urging. That’s a violation of the First Amendment. This is a concerning WSJ Opinion piece and a clear over reach of the Biden Administration. The one-sided bias of social media, media, education, FBI, Census Bureau… should be concerning for all parties. What if it went the other way against the Left? I would be equally concerned about any incredible bias.
McConnell’s grim 2022 expectations-setting
“I think there’s probably a greater likelihood the House flips than the Senate,” McConnell said.” He suggested that “candidate quality” was a key factor.
Census Bureau Admits Over Counting 7 Blue States, Just 1 Red State
This mistake impacts Congressional representation. Yet another example of bias.
Tax cheat Robert F. Smith bought ranch, ski condos, nightclub with hidden money: report
Excuse me for being confused as to why the “largest tax bust in US history” results in far less punishment than the smaller violation of that for Trump’s CFO. I don’t care if both go to jail, but the treatment does not seem to be consistent.
SPAC Activity in July Reached the Lowest Levels in Five Years
Once-hot blank-check firms have fallen out of favor alongside cryptocurrencies and other speculative investments
Missouri Pastor Rips 'Disgusting' Churchgoers Who Didn't Buy Him A Fancy Watch
Click to listen to the wise pastor’s thoughts on his parishioners not buying him a watch. I think it is time to find a new church.
GOP candidate for Florida House is booted from Twitter after post about shooting federal agents
“Under my plan, all Floridians will have permission to shoot FBI, IRS, ATF and all other feds on sight! Let freedom ring!”
Yale professor blasted for program working with 3-year-olds on their 'gender journey'
How is it humanly possible to have a 3-year-old who is ready to talk about a gender journey? Let them play with their toys and watch cartoons.
She Had an AirTag in Her Lost Luggage. It Led Police to a Baggage Handler’s Home
A psychotherapist shares the 5 mental strengths you need to be successful at anything
Concerning article about the shelling of the largest nuclear power plant in Europe (Ukraine) and the potential ramifications at the Zaporizhzhia plant. I was in high school during Chernobyl and now my kids are in high school. I recall being quite scared when it happened.
Darya Dugina: Car bomb kills daughter of 'spiritual guide' to Putin's Ukraine invasion
Crime Related Headlines-There is so much here, I am trying a new section.
NYC sees spate of attacks on kids in Big Apple's affluent neighborhoods: Police experts weigh in
Twitter video shows man’s racist, sexist tirade against Brooklyn NYPD cops
I can’t figure out why the NYPD is struggling to get more police. Any ideas?
Sex offender accused of nearly killing man with punch freed without bail after charges reduced
Watch the video and tell me that this guy should be set free without bail. Victim required brain surgery and is in a coma. I would prefer to see the death penalty here rather than being free. Gov Hochul then ordered the arrest of the released attacker. Good on you, Gov. Don’t let this guy out again and make others stay in jail. NYC needs to be tougher on crime.
Central Park sucker puncher leaves two hurt in NYC, cops say
NYC police search for seven people who stole nearly $30,000 worth of merchandise from Lululemon
Why should police spend time searching for these people? They won’t go to jail. Change the rules and put them away. The impact on communities and business is devastating. Bragg has got to go.
Three charged after NYPD releases video of brutal beatdown that killed NYC cabbie Kutin Gyimah
Chicago police officer charged after kneeling on 14-year-old boy's back in arrest video
California store bans masks after thieves use them to avoid identification
Jews across US harassed with wave of antisemitic letters to homes
Texas woman Erin Mims poisoned by napkin after birthday dinner
Very scary story. Someone put a napkin on her car door. She threw it away, but got poisoned by the contents of the napkin despite washing her hands.
Virus/Vaccine
Everything has turned for the better now. Cases -19% to under 100k/day. Positivity rates which got as high as 19% are down to 16%. Hospitalizations, ICUs and deaths are all declining now as seen below.
Dr. Birx: CDC at 'inflection point,' expects real change following watershed admission
Real Estate
I was invited to golf at Delaire Country Club on Friday by my close friend. Historically, Delaire was for older/retired people with an average age in the 70s. Prior to the pandemic, 35 out of the 325 homes were for sale at any one time, and they did not move very quickly. Houses could be on the market for a year or more. Homes were $500k-$1.5mm pre-pandemic. During the euphoria, all the homes sold, and prices escalated. In December of last year there were ZERO homes on the market. Today, there are 12 for sale, and again things are moving slowly. Interestingly, it is not just 70 and 80 something folks living there anymore. Young families have moved in and there are now little kids running around which are children, not grandchildren of owners. Home prices today range from $500k (knock down) to $4mm. Dues are quite high between $125k to join the club (mandatory) and HOA/Club dues which total approximately $40k/year. 27 holes and tennis and a gym with pool are other amenities along with security and 24-hour paramedics. It is yet another data point showing building inventory, slower turnover and price reductions in South Florida. It is on Military Trail on the Boca/Delray border and is predominately Jewish.
Devin Kay South FL R/E Broker, tells me that high-end remains in demand in Miami with very limited inventory. If you are a buyer, you need to pay up given so little is on the market. However, this headline from the Real Deal does suggest a major slowdown of the overall market. South Florida home sales plunge in July Residential sales tumbled in Miami-Dade to 2,375 closings, marking a 53 percent drop compared to July of last year. Single-family home sales fell 27 percent to 1,373; while condo sales decreased 39 percent to 1,376 closings.
From 2019 to 2021, there was a 35% increase in storefront vacancies in the neighborhood. That's just one finding in a new report titled "Crisis and Adaptation: Storefront Trends in the East Village, 2019 – 2021." The report, released by the Cooper Square Committee, Village Preservation and East Village Community Coalition, provides a deep dive into the neighborhood's commercial landscape that builds off of the 2019 "East Village Commercial District Needs Assessment" to give a 2021 snapshot of the EV commercial district. I am trying to get more data on retail vacancy rates across NYC from the Global Financial Crisis, Pre-pandemic and today for comparative purposes. Any readers that specialize in NYC retail with data, please reach out.
Other R/E Headlines