Opening Comments
My last note was entitled, “The Rosen Report Tipping Guide,” and generated a great deal of responses and feedback. The most opened links were the new game, uncovered shorts (see my score below) and the short YouTube video on tipping. I was told that Uncovered Shorts had their most players ever the day in history after my posting. It is a fun game that takes one minute to play and tests all you Wall Street types in terms of knowledge.
I received many more questions from readers about my tipping policies around hotel housekeepers, pick up orders, European tipping and countless others. Here is where I stand: at a hotel, I do not tip for a one-night stay for housekeepers, but maybe I should. Some of my readers do and leave $10/night. I will leave money if I stay 3 or more nights ($20). If I pick up food at a restaurant, I leave a $5-20 tip depending on order, if it was ready on time, my frequency at the restaurant and the experience.
Some comments from readers: “A hostess never forgets a $100 tip.” Another one, “Just left Ibiza. Tipping culture front and center here. When you take a cab, no one is even asking you to tip, it’s not even an option. And they are super friendly and help you with bags as well. High end restaurants are charging 10% and everyone seems happy. Needless to say, this is mostly a US self-inflicted wound.
The Greyserman golf family continues to amaze. Max came in 13th in the PGA Tour event last weekend and is now 87th in the Fed Ex Cup standings. Max’s little brother, Reed, recently won the NJ Amateur at -14. Max had won the NJ Amateur in 2015. Trust me, do not play the Greyserman boys for money, regardless of strokes. They don’t lose.
Reminder, my readers contribute to the Rosen Report by emailing me story ideas and giving me feedback on my writing. Email ideas and comments to rosenreport@gmail.com. Also, some email servers truncate the report. Hit “View Entire Message,” to see all of it.
I am back in the Hamptons after eating my way through NYC Restaurant Week.
Markets
Philly Non-Manufacturing Index Woes
Nike Needs A Good Olympic Showing
Salary to be Middle Class
WNBA Data
New Miami Office/Restaurant
June Home Sales Weakness
Fire Sale at Rent Stabilized Building
Pictures of the Day-Union Square Cafe and Junoon
I wrote about my favorite restaurants from NYC Restaurant Week, which is actually one month (below). Some restaurants only offer specials at lunch, so call in advance to be sure.
On Monday, the first day of Restaurant Week, I went to Union Square Cafe for the $60 lunch (3 courses). It has been on my Top 20 NYC Restaurants list for years dating back to its 16th Street location. However, I must tell you it is not the same restaurant it once was, despite the fact that it is still very good. I had the tuna tartare and it was hardly special; I have had better tuna appetizers in my life. The burger was good, but a messy, and definitely not the best I’ve had (the bun fell apart and I had to use a knife and fork). I finished with the drunken rhubarb cake for dessert and, again it was nothing better than solid. Yes, I love Danny Meyer. Yes, I will go back, but it just does not have the cache it once did. Go for Restaurant Week when the prices are far more affordable.
For dinner on Monday, I went to Junoon and it did not disappoint. It continues to be a consistent favorite of mine for Indian food. I started with Eggplant Chaat, which is fried deliciousness in a chutney with red onions. I ordered the Murgh Pasanda as my entree-a chicken dish with a saffron walnut sauce. The highlight for me is always dipping the fresh Naan into the sauces of the entree. I use the Naan to clean my plate. My dessert was a beautiful assortment of Indian ice cream. I love Junoon and the $60 Restaurant Week dinner is a steal.
Shelter Island Explained
Shelter Island is a 27 square mile island between the North and South Fork of the Hamptons. You need to get there by ferry. It is a quaint island within the Hamptons, but, given the hassle to get there, I only tend to go once a summer. In a crazy situation, I went on Friday to golf and Saturday for dinner. It reminded me of what I love about Shelter Island.
I was invited to golf Gardner’s Bay on Friday by a 3i member. The course is fun and has some beautiful holes. I really had fun despite my poor play. From Southampton it took almost one hour. The day was stunning, and I enjoyed myself.
I was invited for dinner on Saturday by my friend, Randy. I had heard about a renovated hotel called Pridwin and decided to go early with my wife for a drink. Sadly, the sunset was not great due to cloud cover, but we had a drink outside, which was lovely. We walked around the hotel and thought it was a cute place for a quick getaway. I would 100% stay there for a night or two (no longer-not enough to do). The hotel has 49 rooms and some cottages that range from $500-$1,500+ a night.
From the Pridwin, we drove to the Leon 1909 where we were having dinner. The place is amazing and serves French-talian fare. The open fire kitchen in the middle of the restaurant makes for a great meal, especially as the temperatures drop. Nothing was disappointing from a food, service or ambiance perspective and they also offer outdoor seating. There was not an empty table or seat at the bar. Randy and my wife knew the owner, Valarie Mnuchin, and we were treated like kings. I thought the food was solid and I would go back despite the commute.
The crowd was mixed with a nice dose of younger people, and it turns out 70% of the patrons take the ferry over to eat from the Hamptons during the summer. I did not feel there were weak menu items and I struggled to narrow down the order. As a result, we ordered a ton of food (salads, shrimp crudo, tuna, tilefish, burger, pork chop, chicken, veggies, fries). My personal favorite appetizers were the shrimp crudo, sweet corn custard, Ceasar salad, and the tomato salad. The Ceasar salad was one of the better ones I have had in recent years. I get frustrated with too much dressing and this was the perfect combination of ingredients. As you can see below, all were plated beautifully.
For my entree, I had the burger and it was delicious with the perfect medium-rare temperature. The chicken was a specialty but it did not dazzle me. Next time I will order the pork chop as my entree, as Randy cut me a piece and it packed with flavor. I loved the fries as well. There’s something about bigger fries-they just have a better texture than the crunchy, thinner ones.
Yes, getting to Shelter Island unless you live there is a pain in the ass. I strongly suggest you make your way over and have a drink at the Pridwin or Sunset Beach and enjoy an amazing dinner at Leon 1909. I don’t believe you will be disappointed. Ask for Valarie. She is a lovely host and owner. If Leon 1909 was in Southampton, I would be a regular and demand a permanent table!
Food A-
Ambiance A
Service A
Price-Hamptons Pricing
Quick Bites
Stocks sold off sharply on Wednesday, as tech earnings disappointed. Tech underpeformed with the Nasdaq-3.6% on the day, S&P -2.3% and Russel -1.8%. We have seen the smaller cap companies outperform recently and it will be interesting to see of the rotation out of big picks up steam. On the day, TSLA -12%, Roku -10%, Affirm -10%, Palantir -7%, Zillow -7%, Nvidia -7%, Reddit -7%, Meta -6%, Alphabet -5%, Microsoft-4%. The VIX was up 24% to 18.3 today. Despite these misses from the megacap tech titans, the earnings season overall is off to a strong start. More than 25% of S&P 500 companies have reported their second-quarter earnings, with roughly 80% of them topping expectations, according to FactSet data. Treasury yields were mixed with the front end slightly lower but 10 year +5bps to 4.29% and 30 year +7bps to 4.53%. Oil rallied 1% as inventories fell.
From the Boock Report by Peter Boockvar. The July Philly non-manufacturing index fell to the lowest level since December 2020. New orders, sales, backlogs, inventories, full time employment and the average workweek were all below zero. Bottom line, the softness in this July survey follows the June ISM services index, which surprised by falling below 50 and is something of course to watch from here.
Interesting Newsweek story entitled, “Nike Is in Trouble. Can the Olympics Save It? Nike is going for gold this summer as an official supplier for Team USA's competition uniforms for the Paris 2024 Olympic following a string of problems with the company, including poor financial performance, job cuts and criticism over its products. The sportswear brand took a kicking this spring for its Major League Baseball uniforms, with players complaining of color mismatches, see-through pants and fabric that changed after coming into contact with sweat. It has even faced backlash for some of its Team USA designs, with the women's running gear criticized for being too revealing. "The Paris Olympics offers us a pinnacle moment to communicate our vision of sport to the world. This is led by breakthrough innovation and announced by a brand campaign that you won't be able to miss," CEO John Donahoe said in June. I had not realized the number of missteps by Nike recently. Stock -30% YTD.
Inflation has been so prevalent and persistent that it has impacted everyone. This CNBC story is entitled, “The salary you need to be considered middle class in the 25 largest U.S. cities—it can be over $250,000 in San Francisco. A middle class lifestyle can look different depending on where you are. It may mean owning a house and a car in one city and simply being able to rent a place on your own in another. The middle class is commonly defined as households earning between two-thirds and double the median income, which is $128,151 in the San Francisco-Oakland-Berkeley, California metro area, the Census Bureau reports. That means middle class households there earn between $85,434 and $256,302 a year.
There continues to be haters of Caitlin Clark and I don’t understand it. If you go on a news website, five of the top stories are about the WNBA today and hsitorically, that news was no where to be found. Yes, Angel Reese is contributing as well as other, but this is the Caitlin Clark impact. According to a report by Sports Business Journal, the league is selling merchandise at an all-time clip, seeing a 500% increase since the start of this season compared to the start of last year. On top of that, they have seen jersey/t-shirt sales increase by 1,000% while also shattering viewership records seemingly weekly.
2024 Election
I think this Vladimir Ilyich Lenin quote is appropriate for what has taken place in recent weeks around the US election. “There are decades where nothing happens; and there are weeks where decades happen.”
Biden dropped as I suggested he would. He lasted a week longer than I predicted. There are multiple reports that senior Democrats threatened Biden with the 25th Amendment if he did not exit the race. There was also the suggestion that Dems knew Biden would crash in the debate and he was set up to fail by his own party. Check out this Tweet from Trump in October of 2020.
I do not believe Biden is fit for office and am concerned about his leadership for the next 6 months. He disappeared for days after dropping out of the race which is not what we need in a leader. The geo-political risks are high today and we need a leader that is respected and feared by our enemies; we no longer have that in Biden. I also believe that giving the reigns to Harris would potentially help her prove to her critics that she is capable, even though I have serious reservations. Biden’s address to the country Wednesday evening should be interesting.
I think Americans deserve to know more about the cover up for Biden and the lies by insiders, media, press secretary, cabinet… More reports are out there that people knew for years. This is the President! Americans have the right to the truth. This was a well written article citing countless examples of the media covering for a clearly incapacitated President. We were lied to by the media for years.
I feel uncomfortable about the lack of a democratic process in appointing Harris as the nominee. I believe it is in the best interest of the party and country to have a Blitz Primary rather than handing the nomination to someone who was not selected through the traditional process. However, that ship has sailed, and Harris has the delegates and funds to be the Democrat nominee. This article suggests Harris raised $231mm ($81 from small donors and $150mm from large donors) in short order. It is impressive and shocking at the same time. Wall Street billionaires rally around Kamala Harris as Silicon Valley leaders side with Trump.
A lot can happen prior to the election, as we have found out, but, based on her record, I just wonder if Harris is the best or most qualified candidate for Dems. Anything is possible, but I want to have more confidence in the process. Although I did not see Harris winning, her odds appear to be better than Biden’s were and seem to be improving each day. Post the debate, assassination attempt, RNC, fundraising…Trump looked confident and dominant. The past 72 hours have definitely taken wind out of the Trump sails. The latest Quinnipiac poll has Trump and Harris far closer than I thought they would be and a Reuters poll has Harris in a slight lead. I need to see more polling before I can believe it. How much of this is the euphoric bump as Biden is out of the way? What will the polls look like in three weeks time? Harris is setting TikTok records. We know TikTok is run by China and know they do not want Trump to win. Watch for the Republicans to start chatting about interference from China.
I feel this short video of Harris making a speech was effective and an attack on Trump. She is running as the prosecutor who went after guys like Trump.
Who will be the VP for the Dems? PredictIt suggests Mark Kelly, Josh Shapiro and Roy Cooper are front runners. Mark Kelly is a Senator from AZ and a fighter pilot and astronaut. Josh Shapiro is the Governor of PA and would be the 1st Jewish VP if elected. Roy Cooper is the Governor of NC. I do not know enough about these candidates to have a strong opinion.
This story is incredible and has a Navy Seal showing how poorly the Secret Service executed the protection of Trump. The Seal had a 70 year old on the roof with him that the head of the Secret Service said was too steep. The roof was actually less steep than the ones the snipers were using to protect the President. Kim Cheatle resigned on Tuesday and admitted the Secret Service failed to protect Trump. This is the most incredible video I have seen of the hearings crushing Cheatle. You MUST watch how Rep Pat Fallon EVISCERATES the former head of the Secret Service. The state police warned the Secret Service about the shooter multiple times. How in the hell is this possible and how do we not have more answers.
Secret Service says it denied Trump additional resources in recent years even as his team complained
Why don’t we have answers? Why are there not daily press conferences to be transparent about the assassination attempt?
Tech broligarchs are lining up to court Trump. And Vance is one more link in the chain
Musk says he’s not donating $45 million a month to Trump
I had reported that Musk was donating $45mm/month as that was on multiple news feeds. It appears Musk is giving “at a much lower level.”
Read President Joe Biden’s letter announcing his decision to drop out of the 2024 race
House Republicans say Biden must resign after ending reelection campaign
Nancy Pelosi endorses Kamala Harris: ‘I have full confidence that she will lead us to victory
Barack Obama doesn’t endorse Kamala Harris, says Dems will pick ‘outstanding nominee’
Donald Trump once donated to Kamala Harris campaign in California
Israel/Middle East
Israeli Prime Minister, Benjamin Netanyahu, came to the US and was not greeted by Biden or Harris. Additionally, Harris will not preside over Netanyahu’s speech over Congress. However, Elon Musk will attend Netanyahu’s speech to Congress as his guest.
In fiery speech to Congress, Netanyahu defends war in Gaza and denounces protesters
How can a Jewish person ever give a dollar to this school?
Other Headlines
Jamie Dimon Says It Would Be Best if the Fed 'Waited Now' for Rate Cuts
A reader sent me this fast food inflation chart.
GM far exceeds second-quarter estimates, will restructure struggling China business
Coca-Cola tops earnings estimates, hikes full-year outlook as global demand rises
Tesla’s profit margin is getting hammered by EV discounts and hefty AI spending
Stock -12% after earnings. Auto revenue -7%.
World’s largest luxury group LVMH slumps 4% after second-quarter revenue miss
Alphabet meets earnings expectations but misses on YouTube ad revenue
CrowdStrike shares tumble as fallout from global tech outage continues
-24% in two days then rebounded 2% on Tuesday.
Come Make $100,000, the Billboard Says: Police Departments Are Hustling For Recruits
Wait, you villify police officers and take away resources and wonder why you cannot recruit?
Retail crime ‘queenpin’ faces five years in prison, millions in restitution
A teenage trans girl was ambushed, stabbed at Miami International Airport, police say
Elon Musk says his transgender child was figuratively 'killed by the woke mind virus'
World logs hottest day since records began — with fresh highs expected in the coming months
I’m from Japan, home to some of the world’s longest living people: 8 foods I eat every day
Europe turns to conscription as threat of wider war with Russia grows
Real Estate
The wealth that has migrated to South Florida is unbelievable. The result has been massive increases in housing prices, inability to be able to get into a high-end golf course, full private schools and jam-packed restaurants, regardless of cost. A new Miami Beach office building seeking some of the area’s priciest rents has lured a posh New York restaurant brand to serve a growing financial-industry clientele. Sant Ambroeus is leasing space for a full-service restaurant at the Fifth Miami Beach, a five-story property under construction and scheduled for completion next year. Sant Ambroeus, founded in Milan, has multiple locations in Manhattan and the Hamptons and opened its first South Florida outpost in Palm Beach in 2017. Developers Sumaida + Khurana and Bizzi + Bilgili aim to fill the building with smaller financial tenants, such as hedge funds and family offices. It’s the first ground-up office project in Miami Beach’s South of Fifth neighborhood in more than 15 years, and stands in contrast to the tall towers filling the skyline in mainland Miami’s financial center. Asking rents at the Fifth Miami Beach are expected to be around $170 a square foot. That’s well over double the average for Class-A offices in Miami-Dade County, according to Blanca Commercial Real Estate’s second-quarter report. A lot of the great NYC restaurants have opened in South Florida as well, and more are coming.
Sales of previously owned homes dropped 5.4% in June compared with May, to 3.89 million units on a seasonally adjusted, annualized basis, according to the National Association of Realtors. Sales were also 5.4% lower than June of last year. This is the slowest sales pace since December. These are closed sales, so based on contracts signed mostly in April and May, when the average rate on the 30-year fixed mortgage jumped above 7%. Rates have pulled back slightly since then, to the high 6% range. “We’re seeing a slow shift from a seller’s market to a buyer’s market,” said Lawrence Yun, chief economist for the Realtors. “Homes are sitting on the market a bit longer, and sellers are receiving fewer offers. More buyers are insisting on home inspections and appraisals, and inventory is definitively rising on a national basis.” Sales of homes priced over $1 million was the only price category seeing gains over last year, while the biggest drop in sales was in the $250,000 and lower range. Note the strongest part of the market was $1mm+. This CNBC article outlines the drop in mortgage demand.
Yet another rent-stabilized apartment building sold for such a bargain that it raises the question: How low can prices go? Held since the 1950s by a family firm, 610 West 204th Street in Manhattan traded to an Albanian couple for $3.8 million — just $79,000 per unit, according to Marco Lala, the broker on the deal.
That’s even lower than the paltry average for similar sales in the same neighborhood: $88,685, according to a first quarter report by Ariel Property Advisors. The Inwood property was “not even distressed,” Lala said, pointing to a low level of violations for the 48-unit building. The low-ball price instead reflects the market’s perception of rent-stabilized properties and the high mortgage rates being offered. “There’s so much bad news and negativity,” Lala said. “All buyers are trying to use that to get a fair price.”
© 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™ #702 ©Copyright 2024 Written By Eric Rosen.
Some banks will fail. The banks are far better capitalized today than in 2008. Won’t be widespread. Should be some decent losses. The lower rates will help owners refinance and save money.
Check my writing. I wrote about interest rate cuts. I was on Bloomberg TV last month and discussed cuts and market reactions in 2000, 2008, 2020... Yes, market is pricing in 100% Sep cut. I see two in 2024. Thanks for reading.