The Night I Talked BBall With Coach K
3-6-22
Opening Comments
Jack and I were travelling Sunday, so I likely missed some news stories. We are in Greensboro, GA for 28 hours for a club fitting for Jack at Taylor Made. I wanted to include a bunch of stories, but the flights were delayed, so I am skipping a few I wanted to include.
Stock futures are down 1% (should be down more) as there is discussion (FINALLY) of banning Russian oil. It would be nice to not be reliant on other countries and be energy independent as we were. Oil hit $135 tonight on the news. It has since settled at $125/barrel. We are decades away from alternatives dominating. Again, in the US, less than 1% of cars on the road are EVs for example.
The Russian invasion of Ukraine is having an impact on many policies and countries. For example, the US and European energy strategy are being reconsidered for good reason. Germany is also stepping up its defense spending in response to “Putin’s War.” Switzerland residents are now in favor of joining NATO. Sweden has not been in a war since 1814 and has built its foreign policy on "non-participation in military alliances. Finnish president says NATO membership “under discussion” in Helsinki. Finland shares an 838 mile border with Russia. The relationship with China should continue to be strained given their support of Russia. China is stepping up defense spending by 7.1% in 2022. The countries taking what will be millions of refugees will be impacted for years and let us not forget about the impact on Ukraine and Russian families due to the war and economic destruction. How many years will it take to rebuild Ukraine? How many Russians will need to flee the country? I do not see Putin’s end game. He is destroying his own country and the country he is invading. How much will it take to rebuild?
I have spoken with countless people about the war and many of them well-connected in the region. I was told that Putin did not tell many of his closest friends about the Ukraine invasion. I figured Putin sold his Rubles and any stock positions in advance. Also, his large yacht is never in Russia and he supposedly brought it back just prior to the invasion.
Picture of the Day-Zaporizhzhia Nuclear Power Plant
The Night I Talked BBall With Coach K
Quick Bites
US Markets, Payrolls, Inflation
Gas Prices Soar, Biden Approval Ratings Up
Putin-Going as Planned
Ukraine Exodus, Oligarch Sanctions
Trump Related Election Emails
NFT Sales Tumble
Other Headlines-Many Ukraine/Russia Headlines
Virus/Vaccine
Data-Improvements Continue
Mask Mandate-NYC for Under 5 Years Old
Real Estate
General Comments
Zillow Losses
$141mm LA Estate Auction
Picture of the Day
This is not something we see every day, an attack on a nuclear power plant. I remember Chernobyl in 1986, as I was in 10th grade at Cooper City High and we were in panic mode as we did not understand the consequences. The area of Chernobyl remains uninhabitable for 20 miles some 35 years later. The Zaporizhzhia nuclear power plant in Ukraine, the largest of its kind in Europe, was on fire early on Friday after an attack by Russian troops, the mayor of the nearby town of Energodar said in an online post. The Russian troops seized control of Zaporizhzhia which accounts for almost 50% of Ukraine’s electricity. The fires have been put out and radiation levels are normal. What is next for Putin? This seems incredibly reckless. I fear Putin is unwell with these decisions and others closer to him have suggested the same. Russian are attacking another nuclear facility overnight.
The Night I Talked BBall With Coach K
I think we can all agree that Coach Mike Krzyzewski, also known as Coach K, is one the short list of two for the best coach in the history of college basketball. The only argument in my mind is John Wooden who stopped coaching almost 50 years ago. Here are some statistics to put Coach K’s career in perspective. His record is 1196-366 (.766% winning), he has 5 National Titles, 12 Final Four appearances, 35 births in the NCAA tournament, 5 consecutive Final Fours between 1988-1992, 15 ACC titles, 68 players drafted of which 42 were first round, he has spent 127 weeks with his team ranked #1 and 16 coach of the year awards by various sponsors. Ten of his players have gone on to coach at the collegiate level. Let’s not forget 3 Olympic Gold Medals and 2 World Cup Golds. For a long time, he graduated almost all of his players until one and done became the norm in college. Duke is 26-5 this year and ranked #4 in the AP polls.
Why are we talking about the great Coach K? Saturday was his final regular season home game at home against North Carolina, their big rival. Coach K is hanging it up after 42 seasons. Students have been camped in tents for over one month to get tickets to the game. Tickets to the game were going for $5,392 on average relative to the Super Bowl which averaged $3,800. One ticket is asking $99k and other $17k. I am sorry to say, the big bucks were worth it for this one. I watched the game and yes, I shed tears. I was shocked Duke lost, but not surprised by the coach’s comments afterwards with his sights pointed to the NCAA Tournament.
I have two personal Coach K stories I would like to share with my readers. I was a huge college basketball fan in the 1980s-1990s. I could tell you every starting player on the major teams and was a true fanatic of NCAA basketball before it was ruined by one and done. Today, I could not name 5 starting players in the entire NCAA for $1bn.
One of my closest friends, Chris Seter, played basketball at the University of Michigan, He is 6’9”and won a National Championship in 1989. I was asked to be a groomsman in his wedding in September of 1996. I remain traumatized some 25 years later given the height disparity involved.
For the rehearsal dinner, Chris sat me next to Coach K, given my love of the game. I am not sure I have ever been more excited in my life. I was hanging out with the legend and I was nervous. I was asking him of questions about anything other than basketball as I figured he is sick of talking about his sport. After about 15 minutes, Coach K looked at me and said, “Eric, come on. I am sitting next to you for a reason. Chris told me you are my biggest fan. Are we going to talk basketball or not?” Well, I almost started crying and I fear the great coach regretted those words. I was pounding him about players, games, plays, coaches…until his head was spinning. I think it was one of the best nights of my life and it showed me what a great guy he was by allowing me to talk to him about basketball. I am not sure he has such fond memories and probably got a restraining order on me after that dinner.
The next day, was one of the low points in my life both literally and figuratively. I had to stand up at a wedding with people who are giants. The best man was 6’9” and Rob Pelinka, GM of the Lakers was up there with me at 6’6.” Let’s not forget the bride’s brothers were a hulking 6’2” or 6’3” tall. I was mortified at 5’9” and walked on my tip-toes to fell less small. I felt as though I should be a ring bearer, not a groomsman. It was a Catholic wedding which meant kneeling. I could not do this as I would look too short, so I was in the athletic stance position with more core engaged. I swear I almost died in that position. I was shaking at the altar as I was using muscles for 10 minutes at a time. These people sure kneel for a long time! I was dripping sweat when I walked down the isle after the ceremony with the groom’s sister who was 6’ without her heels. I am hopeful no video of this day surfaces, as it would be too humiliating.
My next coach K memory was from 2011. A few Wall Street guys went down to a game at Cameron Indoor arena at Duke. I had never been to the 9,314 seat facility which is legendary. By comparison, the Garden holds 19,812. Mind you, I have been to every major sporting event, court-side at the NBA finals, World Series, prize fights such as Mike Tyson, Bowl Games…..Nothing and I repeat NOTHING comes close to the environment at Cameron.
Note how close the students (Carmeron Crazies) are to the court.
My favorite Duke game I watched on TV was “the Shot” in the 1992 Regional Final vs Kentucky. With a 2 seconds on the clock, Grant Hill threw the ball the length of the court to Christian Lattener who caught it and made the shot with no time left. I feel it was one of the greatest games in the history of college sports. Duke went on to defeat Michigan (Fab 5) in the finals in 1992 to win the title.
Coach K has done countless leadership seminars, and I was fortunate enough to watch one. Here are 5 of his key leadership insights with the details in the link:
Create shared ownership
Tailor coaching to the person
Hear concerns and respond thoughtfully
Unite big egos
Show your emotions
Coach K, thank you for decades of memories, turning boys into men, being the best coach and showing charter and leadership. You always did it with dignity and grace and set the bar for everyone else. I wish you happiness in your retirement. You have millions of fans and even some UNC alumni will miss you. Yeah right!
Quick Bites
Stocks fell on Friday despite a stronger-than-expected jobs report as worrisome developments in Ukraine weighed on sentiment. The Dow dropped 180 points, or about 0.5%. The S&P 500 also declined 0.8%, while Nasdaq moved down 1.7%. The Dow, on track for its fourth straight losing week, was down more than 500 points at session lows. The decline for stocks followed reports that smoke was visible from a nuclear power plant in Ukraine — the largest in Europe — after Russian troops attacked. Reports Friday morning indicated that Russian forces had seized the plant in Zaporizhzhia. The U.S. embassy in Kyiv called the attack a war crime. For the week, the Dow and S&P 500 slid about 1.3%. The Nasdaq lost roughly 2.8%. Overseas, European stocks fell sharply on Friday and finished the week down 7% for their worst stretch since March 2020. The VanEck Russia ETF, one of the few Russia-linked funds still trading, fell another 2% on Friday to finish the week down more than 60%. Energy prices were higher across the board after the attack, with U.S. benchmark West Texas Intermediate crude up 7% to more than $115 per barrel and global standard Brent crude rising more than 6% to nearly $118. Government bond yields plunged as investors cut risk, with the benchmark 10-year Treasury falling to 1.74%. I am surprised the markets were not down more based on the headlines around the nuclear plant and the continued upward pressure on Oil and Natural Gas. Good news is the coldest weather is behind us, but the summer driving season will be brutal with $4-5/gallon gas and obviously some states in the $6-7 range. CA already averages $5.18/gallon. Crypto was under pressure with the markets and BTC was -3% and ETH -2.5%.
Nonfarm payrolls rose by 678,000 in February and the unemployment rate fell to 3.8%, with the job gains much stronger than expected. Friday’s report showed average hourly earnings were little changed in February and up 5.1 per cent from a year ago, a deceleration from the prior month, while hours worked picked up slightly. The disappointing wage data are even worse after accounting for faster inflation. The 2nd chart tracks the total number of employed persons in the US, and you can see we are still below the 2020 pre-pandemic levels by over 1mm. Make no mistake, the recovery was far faster than I expected.
Total Employed Persons in the US
I mentioned this in my last piece. I was of the belief that inflation was going to peak in coming months, but did not foresee the Ukraine invasion. I now fear inflation could last longer than I thought just a few weeks prior. Higher food and oil prices as a result of Russia’s invasion of Ukraine could send U.S. inflation to the highest annual level since 1981, based on estimates of the impact on global supplies from Wells Fargo. If oil remains above $100 a barrel and the Commodity Research Bureau Food Index increases 35% from the end of last year, it would add 1.3 percentage points to the consumer price index this year, according to a research note Thursday from economists led by Sarah House. Average annual CPI is forecast to rise 5.1% in 2022 after increasing at a 4.7% pace last year, according to a Bloomberg survey of economists. We all have examples of higher prices of R/E, cars, food, consumer products, commodities, travel, rental cars…. Food prices jumped 20.7% in February (year over year) according to the UN. On a related note, I thought this headline was interesting: The Fed has been terribly wrong about inflation and is going to have to 'bite the bullet' on rate hikes, says Wharton's Jeremy Siegel. I am not a big Jeremy Siegel fan, but have been screaming about the Fed for a long time. FYI, Lumber prices are back through the roof and are only 20% from last summer’s high levels.
In 2010, wheat prices jumped 58% around the time of Arab Spring. Since June, wheat prices are +137%. I am not sure how strong the causality is, but presume Pippa Malmgren is far more articulate on the subject than me.
These prices are no irrelevant due to the news and oil at $125+/barrel now. I am sure gasoline prices will be up sharply this week. Clearly, the all-time high discussed below will be passed in coming days. The levels below are just the beginning if we stay over $125. Gas prices rose the most in history in one day +18c, +27c in two days, +40c in a week and +57c in a month. One year ago, gas was $2.76/gallon and it is +45% since. The US now averages $4.0/gallon, but remains below the all-time high of $4.1/gallon in July 2008. CA is at $5.29/gallon, NY at $4.20 and IL at $4.26. Energy independence is critical for national security. Even Elon Musk wants the US to increase oil and gas output despite the fact that it negatively impacts Tesla. The Europeans screwed up big time, especially Germany. Europe’s plan for carbon neutrality has been a disaster for them and has been exasperated by a move away from long-term purchase contracts. They closed nuclear, coal-fired facilities and have increased reliance on renewables before they were ready. I have said it is a long time before we can rely on renewables over fossil fuels. Again, less than 1% of the cars on the road in the US are electric for perspective. They are also dependent on Russia for natural gas. The US continues to import oil from Russia. Why should we do this? There is so much hate on energy production. We will require it for the foreseeable future. Articles I read vary, but believe we imported 200k barrels/day from Russia and 500k of other petroleum products. One article suggested we imported 405k barrels of crude oil in December from Russia. Now Pelosi is supportive of banning Russian oil imports to the US, but Biden has been reluctant. Clearly, the President is very concerned about rising prices at the pump. This would not have been as big of an issue if we were energy independent as we were 18 months ago.
Biden’s approval rating jumped on his handling of the Ukraine situation. President Joe Biden’s approval rating jumped 8 points in the past week, according to a large national poll released Friday. Support for Biden’s handling of Ukraine rose an extraordinary 18 points over the same period. And while no single poll is ever totally accurate, this one conducted by NPR the PBS NewsHour and the Marist Institute suggests Biden’s abysmal ratings over the past several months could be turning a corner. In the same NPR/Marist poll on Feb. 25, Biden’s overall approval was 39%. On Friday, it was 47%. Meanwhile, support for Biden’s handling of Ukraine soared last week from 34% to 52%, led by double digit increases among Democrats (+ 27 points) and independents (+ 17 points). The poll surveyed more than 1,300 adults, and had a margin of error is 3.8%. This CNN story is entitled, Is this the beginning of the Joe Biden comeback? For the sake of the USA and the world, I sure hope so, but you will excuse me if I don’t yet declare all is well in the White House just yet.
Russia’s attack on Ukraine is going ‘according to plan’ and the violence will ‘get worse,’ Vladimir Putin warned. The Russian President made the alarming comments to Emmanuel Macron, his French counterpart, during a phone call on Thursday afternoon. After hanging up the phone at the end of the exchange, which lasted for an hour and a half, Mr. Macron said "the worst is yet to come." An Elysee Palace spokesman explained: ‘President Putin expressed his very great determination to continue the offensive, the aim of which is to take control of the whole country. " Russian President Vladimir Putin warned Saturday that his country would consider any third-party declaration of a no-fly zone over Ukraine as participation in the war there. "That very second, we will view them as participants of the military conflict, and it would not matter what members they are," Putin said. Putin also noted Western sanctions are akin to declaration of war.
Over 1,450,000 Ukrainians left to bordering countries as of Saturday. This is the fastest and largest displacement since WWII. What are the ramifications for the neighboring countries taking all the people? UN fears have the number of Ukrainians leaving at 4,000,000 in the near term.
Elites might transfer assets to relatives or, in the case of super-yachts and private jets, park them in out-of-reach jurisdictions. The key difference, according to lawyers, economists and ex-government officials interviewed by Bloomberg, is that sanctions can be passed relatively quickly, while seizure is a more drastic step that involves a potentially lengthy legal process. I am all for crushing Russia with sanctions and isolating them from the world. I love the bank sanctions, SWIFT rules, eliminating access to US credit cards, not allowing Russian flights over other airspace, not supporting Russian airplane service… However, I am a bit more concerned about the precedent setting of seizing oligarch assets. I fear the west is going down a slippery slope. This Business Insider article raises questions about the legality of such seizures. Also, who pays for the maintenance and staffing of these expensive ships when taken?
Donald Trump adviser John Eastman’s emails may have evidence the former president and his associates committed crimes in attempting to prevent Congress from certifying the 2020 election results, a House committee investigating the Jan. 6 insurrection said in a court filing. It’s the first public signal that the committee is looking into criminal activity by those within Trump’s inner circle. The committee says the emails may contain evidence of obstruction of an official proceeding -- a felony that carries a maximum sentence of 20 years in prison -- a conspiracy to defraud the U.S. and common law fraud. This CNN link has the email exchange which is too long for me to insert.
Another AP story has similar conclusions. Trump and his associates engaged in a “criminal conspiracy” to prevent Congress from certifying Democrat Joe Biden’s victory in the Electoral College, the House committee said in a court filing. Here is another Trump headline: Former AG Barr said Trump became enraged after being told election fraud claims were nonsense.
I do not believe Trump should praise Putin right now even if he believes it. Trump, now is the time to act Presidential as the world needs leaders.
Apparently, NFT sales are showing signs of slowing as they are down 83% since Jan 31st and the average price has dropped to below $2,000 relative to an all-time high of $6,900 on Jan 2nd. The daily total sales average was about $26.2 million on March 3, the data show. The tally was $160.2 million on Jan. 31. Since Feb. 24, when Russia attacked Ukraine, the average selling price has dropped by about 30%. Many NFT marketplaces have experienced trading-volume declines. OpenSea’s trading volume is down 30% in the last seven days, per DappRadar. Rival platform LooksRare’s volume is down 16%. Even popular game Axie Infinity’s volume is down 21%, per DappRadar. Who could have seen this coming? Buying worthless crap for huge money made no sense. I am yet to buy an NFT because I never saw one worth the money. Tulip Bulb Craze? I do believe the technology is real and expect smart contracts for many things in the near future. However, millions of dollars for art does not make sense to me.
Other Headlines
Various
Berkshire Hathaway reveals $5 billion stake in oil giant Occidental Petroleum
AI model detects mental disorders based on web posts
What does AI say about the Rosen Report. Wait, don’t tell me. It says I am crazy.
Rep. Van Taylor apologizes for affair with ‘ISIS bride,’ abruptly drops reelection bid
Talk about horrible judgement. He sounds like the perfect politician.
I don’t condone such behavior. It was beneath any politician to behave in this manner.
Adams again takes aim at state bail reform law after Bronx poop attack
“This individual should not be out on the streets of New York and his release shows the scope of changes that we need to make in order to keep New Yorkers safe,” Adams said in a statement Thursday, a day after Frank Abrokwa was released for the second time on unrelated hate-crime charges from September.
Fantasy author raises $19 million on Kickstarter in two days to self-publish new novels
Maybe the Rosen Report is heading to Kickstarter
UA, student organizations call on Penn to immediately fire Amy Wax
School Superintendent Responds After Florida Gov. Ron DeSantis Scolds Students For Wearing Masks
Two pre-teens arrested in violent assault, torture of girl at sleepover
How does this happen? What kind of parents do we have here? These kids should be sent to juvie. It is a scary read. Almost killed the little girl.
Illegal immigrant slapped with 4 life sentences for brutal murders
Read the story. I do not believe jail is punishment enough.
Sherri Papini, husband allegedly paid off credit cards with $49,000 donated to kidnapping hoax
This one is irritating. I could not believe this young woman was kidnapped and branded and it turned out to be a hoax. I hope she spends life in jail.
Nothing like an $850 steak with frozen fries. What a fraud.
Let me be crystal clear. If this thing lands on me, I am going to soil myself. Someone on the Rosen Report better have a solution to this spider issue or I am going to become a recluse and not leave my house.
Russia/Ukraine
Russian economy to shrink 35% due to Ukraine invasion sanctions, JPMorgan says
These numbers are huge. Economy collapsing, oligarchs being chased down, Ruble getting crushed, companies pulling, bank access to SWIFT gone…
Here are the Russian oligarch yachts being seized as sanctions sink in
Maybe with all the yachts being seized, Rosen Report readers can chip in and we can buy one of these beasts and split it up. Oh wait, the carrying costs are about $10-20mm/year. I’ll pass.
Visa, Mastercard suspend all operations in Russia, 'effective immediately'
Russia's answer to Google warns it may not be able to pay its debts
Yandex handles 60% of internet search traffic in Russia and operates a large ride-hailing business.
S&P Dow Jones is removing Russia stocks from indexes, stripping country of emerging market status
People around the world are booking Airbnbs in Ukraine. They don't plan to check in
Ukraine war: Russia losing information war at home, scrambles to reshape narrative
Russia-”Only trustworthy sources are allowed to be used when reporting this special military operation, and if you don’t do that, we will take you off-air.” Two news agencies were closed and reporters are fleeing Russia over security concerns.
It is time we reduced our reliance on China and Russia. We need to make critical items in the US and be energy independent as we were in the recent past. Bring back manufacturing to the US.
Sky News correspondent shot while covering Ukraine invasion
Scary video. I give these correspondents credit for going into harm’s way. I would never consider it.
Vladimir Putin's war gadget 'robo-balls' that look like Star Wars' BB-8 ready to deploy
Pretty cool technology which was used in Syria.
Virus/Vaccine
Chart is self-explanatory and data continues to improve across the board.
Pandering to rank ignorance, Mayor Eric Adams is leaving the school-mask mandate in place for children under 5 — who face utterly trivial risk from COVID, and significant risk of learning failure from masking. In the entire rest of the world, next to no one ever made toddlers mask at all — and the kids were fine. In the 46 states in the American Academy of Pediatrics database, from zero to 0.01% (that’s one in 10,000) of all child COVID cases resulted in death, and those few overwhelmingly involved serious complicating factors. The total US death toll for all under-18s in nearly two full years of the pandemic is below 800. A massively high percentage of the deaths had at least one comorbidity. I am adamantly opposed to this mask mandate for little children. It is absurd and I believe does more damage than good at this point in the pandemic.
Real Estate
Royal Palm in Boca is up to 7 listings after only 4 last week. Three are under construction, one is a tear down. One is a home we considered in 2017. I thought it was worth $4mm at the time and it sold for $4.4 six months later. Today, it is listed for $8.8mm. Recall, when I moved to Florida, there were approximately 70 homes for sale for an average price of $4.9mm in 2017. The average listing price today of the 7 homes is $12mm and one is a tear down. So, 1% of the homes in the community are for sale which is down from 8-10% pre-crisis. This includes the debacle house I wrote about in the last note which is on the busy street and must contend with bridge traffic three times/hour and is listed at $9.7mm. Separately, I spoke with a reader who lives in Broken Sound, a gated community in Central Boca. He bought a small home for $70k in 2019 and he was told by a broker it is now worth $500k. Yes, Florida is on fire. The issue is you must join the club for 6 figures and the annual dues are very high. When he bought the house, the membership was more than he paid for the home and you lose the initiation fee when you leave.
Listings giant Zillow lost more than $880 million on its failed home-flipping business in 2021, the company reported. According to the Wall Street Journal, the otherwise profitable home-listing and real estate advertising company ended up losing nearly $530 million overall, with the bulk of the losses coming from its since shut-down Zillow Offers, which was responsible for the majority of Zillow’s income — $6 billion of ithe $8.1 billion it generated — but none of its profits
A 105,000-square-foot Los Angeles megamansion that was listed for $295 million sold at a bankruptcy auction for $141 million, ending a 10-year saga of soaring debt and failed dreams. The auction for the property, known as “The One,” ended Thursday night with the highest bid at $126 million. Including the buyer’s premium, the final sale price will be $141 million, according to Laura Brady, CEO of Concierge Auctions, which auctioned the home. The price makes it the third-most expensive home ever sold in Los Angeles, behind Marc Andreessen’s $177 million purchase last year of a Malibu compound and Jeff Bezos’ purchase of the former Jack Warner Estate in Beverly Hills for $165 million.
