Matrix Blog

Wall Street, Financial Services

New Record of Foreign-owned Assets in the United States

March 27, 2014 | 4:06 pm | wsjlogo |

3-14commerceForeignInvestors

According to the WSJ Real Time Economics Blog there are the record investment gains. This is good news/bad news…and:

has worried some economists, because it makes the U.S. more vulnerable to major shifts in the global economy. But it also could show strengthening confidence in the American economy.

These gains are largely due to the rising US stock prices rather than more investment. However in the housing sector, I do think rising property values are attracting even more new capital for investment – whether for new development or unit purchases. We can see this in markets like New York City and Miami. Foreign investors seem to be chasing safety and a long term equity play.

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Spot the Manhattan Luxury Townhouse Lehman Effect?

March 23, 2014 | 10:03 am | bloomberglogo |

bb3-14luxTH

Ilan Kolet from Bloomberg News whipped up this chart and shared on twitter using our Manhattan luxury townhouse data.

Gotta love the visual – the 2008 Lehman collapse exemplified in the high end townhouse market in the home of Wall Street.

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[Three Cents Worth #263 NY] Do Wall Street Bonuses Affect NYC Sales?

March 18, 2014 | 4:13 pm | curbed | Charts |

It’s time to share my Three Cents Worth (3CW) on Curbed NY, at the intersection of neighborhood and real estate in the capital of the world…and I’m here to take measurements.

Check out my 3CW column on @CurbedNY:

According to the 5/25 rule, the ratio of New York City jobs in the securities industry and the income they account for is 5 to 25: approximately 5 percent of NYC jobs come from the securities industry and they account for about 1/4 of personal income. With such a large, and disproportionate market share of NYC income, Wall Street has long been considered a lynchpin of the NYC real estate economy and perhaps most strongly aligned with Manhattan.

Still, it is a stretch to associate the ebb and flow as a predictor of future gains and losses in Manhattan housing prices, especially when considering deferred compensation. (Also, many Wall Streeters are getting paid from income deferred from a few years ago when times weren’t as good.) But it’s fun to chart. Especially after last week’s announcement by the State Comptroller of a 15.1 percent increase in both the Wall Street bonus pool and on a per person basis…

3cwNY3-18-14
[click to expand chart]



My latest Three Cents Worth column on Curbed: Do Wall Street Bonuses Affect NYC Sales? [Curbed]

Three Cents Worth Archive Curbed NY
Three Cents Worth Archive Curbed DC
Three Cents Worth Archive Curbed Miami
Three Cents Worth Archive Curbed Hamptons

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Bonus for NYC Housing: Wall Street Comp Up 15.1%, Most Cash Paid Out Since ’08 Crash

March 17, 2014 | 7:00 am | Charts |

The annual release by the New York State Office of Comptroller brought upbeat news to the real estate economy in NYC. Wall Street compensation has long accounted for roughly a quarter of personal income but only 5% of employment so the industry remains very important to NYC’s tax revenues. Here are some of the key points:

  • The overall bonus pool and bonus per person increased 15.1%.
  • The total bonus pool was
  • Bonus pool is up 44% in past 2 years.
  • Securities employment is down 12.6% from before the 2008 market crash.
  • Wall Street accounts for 8.5% of NYC tax revenue and 16% of NYS tax revenue
  • Part of the rise was due to payouts of deferred compensation from prior years.

Here are a few charts that layout the bonus trends in NYC. Wall Street is a key economic driver of NYC and therefore important to the health of the NYC housing market.

Wall Street compensation is 5x that of mere mortals (other private employment compensation) and that ratio has stabilized after a modest correction following the 2008 stock market crash.
2013nycsecuritiesbonus
[click to expand]

Wall Street bonuses rose steadily as a portion of total compensation but after the 2008 stock market correction and financial reform, the market share fell – but not as much as perceived.
2013nycsecuritiescompasperc
[click to expand]

Wall Street employment has fallen since 2008, but not nearly as much as expected. The market share of Wall Street NYC employment has slipped as a result.
2013nycwallstreetemployment
[click to expand]

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Impact of Lehman Collapse on Housing Prices in Europe

September 13, 2013 | 3:52 pm | kflogo |


Source: Knight Frank [click chart to expand]

This chart could also be called “Why International Demand for US housing is Elevated” since many European investors are looking for safe places to park their money.

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Miller Samuel Luxury Market Indices on Bloomberg Terminals Through 2Q 2013

August 12, 2013 | 8:41 pm | bloomberglogo | Charts |

Here are the 3 Manhattan luxury housing price indices we provide for the Bloomberg Terminals through 2Q 2013.

MLH AVG Index (Miller Samuel Manhattan Luxury Housing Average Sales Price) [click to expand]

MLH SQFT Index (Miller Samuel Manhattan Luxury Housing Price Per Square Foot) [click to expand]

MLH MED Index (Miller Samuel Manhattan Luxury Housing Median Sales Price) [click to expand]

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Money for Nothing Movie Trailer

March 28, 2013 | 5:29 pm | fedny | Videos |

I can’t wait for the documentary Money for Nothing to be released. In fact I donated to IndieGoGo.com because I was so impressed that I wanted my own copy.

This documentary is compelling and so are all the cast members. It includes a who’s who list of current and past members of the Federal Reserve as well as economists and Wall Street experts. Cast members include my friend Barry Ritholtz and Gary Shilling who both have been on my podcast. Todd Harrison of the great site Minyanville.com and John Mauldlin who I have always looked to for insights. Jim Grant of Grant’s Interest Rate Observer who called me at the height of the crisis to get a gauge on the Manhattan housing market.

During the housing bubble I often felt like screaming as I saw the financial world through my appraisal glasses thinking I missed an important math class in 8th grade. Fast growing banks with gigantic mortgage volume and many of my appraisal competitors in bed with mortgage brokers were clearly smarter than me – they could make the numbers work and I couldn’t.

In 2003 and 2004 I remember being absolutely confident as a non-economist that the Fed was keeping interest rates too low for too long. I could see it in the loss of lending standards and the lavish incomes enjoyed by those around me who embraced a world of based on moral flexibility. The froth was simply ignored.

Don’t mean to get sentimental on you dear readers, but this movie struck a chord with me. Enjoy the trailer and watch for the release date announcement.

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Wall Streeters Paid 7X The Private Sector

February 27, 2013 | 12:42 pm | curbed | Charts |

In case you have any doubts about the amount of compensation that the securities industry enjoys versus the private sector in NYC, I created the chart above. While the bonus comp results has been released for 2012, the salary data is not out yet so I built this chart from 1985-2011. In 2011, securities industry salaries + bonuses were 7x larger than private industry salaries.

In case you had any doubts about how important the industry is to the NYC, regional and state economy, hopefully you are now – love them or hate them.

Since Wall Street bonuses were announced yesterday and have been talked about and analyzed a lot over the past 24 hours, I thought I’d share the following video which apologizes a lot for compensation levels of the securities industry but breaks down the advantages of the bonus compensation practice on Wall Street.

I was provided with a video from OnlineMBA.com



Three Cents Worth: Have Bonus, Will Buy in Manhattan? [Curbed NY]
In Defense of the Wall Street Bonus [OnlineMBA]
NYC Securities v. Other Private Industry Compensation [Miller Samuel Charts]
Wall Street Bonuses Rose in 2012 [NYS Comptroller]

UPDATE: Bloomberg Television saw this post and made it their “Single Best Chart” of the day.

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[Three Cents Worth NY #224] Have Bonus, Will Buy in Manhattan?

February 26, 2013 | 5:16 pm | curbed | Charts |

It’s time to share my Three Cents Worth (3CW) on Curbed NY, at the intersection of neighborhood and real estate in the capital of the world…and I’m here to take measurements.

Check out this week’s 3CW column on @CurbedNY:

Since New York State Comptroller Thomas DiNapoli graciously accommodated our Tuesday Three Cents Worth release date with his report on Wall Street Bonuses, I thought I’d try to come up with a chart that somehow correlates Wall Street cash bonus payments and the Manhattan housing market. Prices don’t correlate well with any form of Wall Street bonus data and employment trends seem to be too macro to equate with annual housing price trends…


[click to expand chart]



Today’s Post: Have Bonus, Will Buy in Manhattan? [Curbed]
Three Cents Worth Archive Curbed NY
Three Cents Worth Archive Curbed DC
Three Cents Worth Archive Curbed Miami

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Miller Samuel Luxury Market Indices on Bloomberg Terminals

January 28, 2013 | 11:00 am | bloomberglogo | Charts |

Here are the 3 Manhattan luxury housing price indices we provide for the Bloomberg Terminals.

MLH AVG Index (Miller Samuel Manhattan Luxury Housing Average Sales Price)
[click to expand]

MLH SQFT Index (Miller Samuel Manhattan Luxury Housing Price Per Square Foot)
[click to expand]

MLH MED Index (Miller Samuel Manhattan Luxury Housing Median Sales Price)
[click to expand]

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