Monday, August 17, 2020

Will New York Come Back?

50 people were shot in New York City this weekend. The Big Apple will soon be competing with Chicago for the title of Gun Violence Capital of the United States. In case you care, the correct  “woke” opinion is to blame it on the NRA. Because the best way to tamp down on crime is either to shift the blame or to pretend that it doesn’t exist.

And let’s also note that a few days ago a group of protesters stopped traffic in Times Square. They threatened drivers with bodily harm. The police were nowhere to be found. Does that make you want to drive through New York City?


And then there is James Altucher, hedge fund guy, entrepreneur, self-help guru, among other things. Recently, he put up a long post on Linked In explaining that New York City is done, finished. For those who believe that a new mayor, who will arrive in less than eighteen months, will save the city, Altucher rains on their parade. 


He notes, as we have on this blog, that office buildings in New York are now empty. People are working off site and are liking working off site. Of course, people do lose something when they cannot interact with their colleagues in an office. Getting out of the home and into a professional space makes a difference.


But, as I noted yesterday in a comment, what happens if the companies whose employees yearn for an office environment simply move their offices to other cities, to Austin, to Nashville, to Miami. Or better, to one of the suburban shopping malls that have been rendered near-obsolete by Amazon. At the least, the rent will be cheaper. If corporate culture does not need New York, perhaps it will move elsewhere, even after the pandemic has passed.


As for quality of life in New York today, Altucher quotes a friend who wrote this on Facebook:


"In the last week:


* I watched a homeless person lose his mind and start attacking random pedestrians. Including spitting on, throwing stuff at, and swatting.


* Ive seen several single parents with a child asking for money for food. And then, when someone gave them food, tossed the food right back at them.


* I watched a man yell racist slurs at every single race of people while charging / then stopping before going too far.


And worse.


I’ve been living in New York City for about 10 years. It has definitely gotten worse and there’s no end in sight.


My favorite park is Madison Square Park. About a month ago a 19 year old girl was shot and killed across the street.


I don’t think I have an answer but I do think it’s clear: it’s time to move out of NYC.


I’m not the only one who feels this way, either. In my building alone, the rent has plummeted almost 30 percent - more people are moving away than ever before.


So, it’s even worse now than it was in the 1970s:


Even in the 1970s, and through the 80s, when NYC was going bankrupt, and even when it was the crime capital of the US or close to it, it was still the capital of the business world (meaning: it was the primary place young people would go to build wealth and find opportunity), it was culturally on top of its game - home to artists, theater, media, advertising, publishing, and it was probably the food capital of the US.


But today, New York’s cultural scene is just about dead. This means fewer tourist dollars and a lot less work for a lot of people


Broadway is closed until at least the Spring. Lincoln Center is closed. All the museums are closed.


Forget about the tens of thousands of jobs lost in these cultural centers. Forget even about the millions of dollars of tourist and tourist-generated revenues lost by the closing of these centers.


There are thousands of performers, producers, artists, and the entire ecosystem of art, theater, production, curation, that surrounds these cultural centers. People who have worked all of their lives for the right to be able to perform even once on Broadway whose lives and careers have been put on hold.


I get it. There was a pandemic.


Of course, there’s always commercial real estate. As you know, one of the bright spots in the city has been the resilience of commercial real estate. Apparently, it is not as resilient as some of us imagined. Altucher sees a depressive spiral:


If building owners and landlords lose their prime tenants (the store fronts on the bottom floor, the offices on the middle floors, the well-to-do on the top floors, etc) then they go out of business.


And what happens when they go out of business?


Nothing actually. And that's the bad news.


People who would have rented or bought say, "Hmmm, everyone is saying NYC is heading back to the 1970s, so even though prices might be 50% lower than they were a year ago, I think I will wait a bit more. Better safe than sorry!"


And then with everyone waiting... prices go down. So people see prices go down and they say, "Good thing I waited. But what happens if I wait even more!" And they wait and then prices go down more.


This is called a deflationary spiral. People wait. Prices go down. Nobody really wins. Because the landlords or owners go broke. Less money gets spent on the city. Nobody moves in so there is no motion in the markets. And people already owning in the area and can afford to hang on, have to wait longer for a return of restaurants, services, etc that they were used to.


Well, will prices go down low enough everyone buys?


Answer: Maybe. Maybe not. Some people can afford to hang on but not afford to sell. So they wait. Other people will go bankrupt and there will be litigation, which creates other problems for real estate in the area. And the big borrowers and lenders may need a bailout of some sort or face mass bankruptcy. Who knows what will happen?


Of course, with colleges shut down, with remote learning on the rise, the students who would be coming to New York, eating in restaurants, going to clubs, even renting apartments… will not be doing so. One more nail in the coffin.


Altucher says that it’s all about bandwidth. Greater bandwidth makes remote meetings more realistic. It is not the real thing, but it is close enough. And beside, people have adapted to them.


Remote learning, remote meetings, remote offices, remote performance, remote everything.


That's what is different.


Everyone has spent the past five months adapting to a new lifestyle. Nobody wants to fly across the country for a two hour meeting when you can do it just as well on Zoom. I can go see "live comedy" on Zoom. I can take classes from the best teachers in the world for almost free online as opposed to paying $70,000 a year for a limited number of teachers who may or may not be good.


Everyone has choices now. You can live in the music capital of Nashville, you can live in the "next Silicon Valley" of Austin. You can live in your hometown in the middle of wherever. And you can be just as productive, make the same salary, have higher quality of life with a cheaper cost to live.


Besides, the lunatics are now running the asylum. Across America great cities are now being run by crazed leftists. They have allowed the streets to become unsafe, at any speed. They allow criminals to walk free. They think they can solve it by raising taxes. Parents with children have noticed and they are moving out.


Will business opportunities return? Not if companies follow people and relocate, Altucher explains:


There won't be business opportunities for years. Businesses move on. People move on. It will be cheaper for businesses to function more remotely and bandwidth is only getting faster.


Wait for events and conferences and even meetings and maybe even office spaces to start happening in virtual realities once everyone is spread out from midtown Manhattan to all over the country.


The quality of restaurants will start to go up in all the second and then third tier cities as talent and skill flow to the places that can quickly make use of them.


Ditto for cultural events.


And then people will ask, "wait a second - I was paying over 16% in state and city taxes and these other states and cities have little to no taxes? And I don't have to deal with all the other headaches of NYC?"


Because there are headaches in NYC. Lots of them. It's just we sweep them under the table because so much else has been good there.


NYC has a $9 billion deficit. A billion more than the Mayor thought they were going to have. How does a city pay back its debts? The main way is aid from the state. But the state deficit just went bonkers. Then is taxes. But if 900,000 estimated jobs are lost in NYC and tens of thousands of businesses, then that means less taxes unless taxes are raised.


Oh yes, the debt, Cities like New York and Chicago are effectively bankrupt. Good luck bringing them back. Sometimes the phoenix does not rise from the ashes.


13 comments:

whitney said...

And sometimes when you see the Phoenix raising its head you need to get a baseball bat and beat it to death

trigger warning said...

Excellent post. And one of my own conclusions after having read your and Altucher's observations is that the effects you describe are perfect examples of the exploding cigars that inevitably accompany celebrations of leftist theory implementations.

For instance, Proglodyte mayors and governors seemed to compete with one another to see who among them could most effectively crush the economies that feed them, raising the ante with evermore extreme lockdowns and bizarre regulations. Because, in my view at least, strangling a booming economy was perceived as taking away Donald Trump's most powerful electoral lever. And they weren't at all bashful about it, having often wished publicly (via the MSM) for a recession.

Now they're on the horn begging the moneychangers, that den of entrepreneurial and capitalist thieves, to come back to the courts of the temple. Pass the popcorn, please.

:-D

urbane legend said...

remote meeting . . .

Contradiction in terms, isn't it?

Give everybody $50,000 to move, give them 1 month, then get it over with. Just move the mentally ill. They don't belong on the street anyway. Move them to Sioux City, Iowa, or somewhere where the indigenous can get them back to nature. Put a wall up around NYC, Portland, Seattle, Chicago, and the others on the edge. Or nuke them.

Net meetings can be done anywhere. Art, such as it is, can be produced in Baton Rouge, LA. A new Broadway can spring up in Eldorado KS.

I can feel the country better off already.

Ignatius Acton Chesterton OCD said...

With 49 people shot in NYC over 72 hours, methinks Gotham has bigger issues to wrassle with.

This speculation and begging is moot if no one feels safe.

Someone please tell de Blasio. Whether he's listening is another story...

Meanwhile, Biden's polling numbers are slipping dramatically. de Blasio might want to stop counting on that Federal bailout cash. Somehow I suspect Trump will remember the "Black Lives Matter" street art de Blasio took part in when it comes time to take care of those ravaged by the COVID-19. And keep in mind many of these State and municipal leaders brought economic disaster on themselves to cripple OrangeManBad's economic prowess/success.

Here in Michigan we have Governess Whitmer daily whining and wailing about the lack of Federal aid. Readers of my comments here will remember that I thought it most unwise for a State governor to chide, taunt and malign the President of the United States when common sense and fiduciary responsibility would dictate that she be more restrained. I don't care who you think you are (or whether you think you're in contention for a VP slot), you don't mess with POTUS if you're gonna need something down the line -- ANY POTUS! Ever. POTUS has a vast arsenal of ways to make sure you feel the sting.

These Leftist idiots cannot help themselves, so it is the troublesome citizenry that must suffer under the mask and the boot.

Sam L. said...

Don't forget Detroit and Chicago and St. Louis.

The Golden Goose is DEAD. KAPUT. Out of Business. Passed on. Carcass stinking to high heaven. Outa Dodge, left no forwarding address. If you have a Democrat Mayor and a Democrat Governor, YOU are a TWO-TIME LOSER. May not be your fault, but "you gotta get out of this place".

Giordano Bruno said...

I wonder if this is what Lot was thinking shortly after the Angels arrived at his door and just before the mob surrounded his home?

This will be far worse than the 1970's. In the 1970's there were still huge pockets of normal people living in NYC with strong ethnic bonds to one another; actual cultural solidarity based of race, religion, and tribe. Those pockets are vastly diminished. There was even an old, doddering WASP aristocracy around in the 1970's and many of the institutions still had some integrity. When the money leaves, we're about to see what NYC is really made of these days. I say it's composed of whipped shit.

I do not believe that most people can ever articulate exactly what is happening; they have long ago exorcized all the language and ideas that might be of help. That type of man was banished years ago. Perhaps it can all be fixed up with some additional funding for therapy and education?

EarlW said...

It's not just the 'big' cities...
Here in Montreal, the downtown core is dead. No students, no office workers, no shoppers. Public transport has become a virus vector.
COVID was just the final push.
Traffic downtown has been a nightmare for years. Ask any Montrealer about orange cones and 'Rue Barre'. Our 'green' mayor has closed parking lots for shoppers and replaced street parking with bike lanes (useful when it's bitterly cold...).
Many restaurants survive on delivery and social distancing makes ordering groceries online a practical alternative.
In summary, the change is painful, but probably better in the long run.

Anonymous said...

Whatever these New Yorkers do they should not move to the West, especially the Intermountain West states. It's horrible here and they will be miserable. In the summer it's hotter than blazes and if you aren't burnt to a crisp by the wildfires you will certainly be stricken down by lung cancer from the wildfire smoke or skin cancer from the burning sun. In the winter it's freezing cold for months at a time and snowstorms dump many feet of snow at a time, shutting down entire cities for months at a time.

And if the weather doesn't get you the animals will. Bears, which can crush your skull with one swipe of their paw, run rampant through cities and suburbs in the summer months. Mountain lions and wolves attack people at will. There is a rattlesnake behind every bush in the summer and autumn is tarantula season. Ever been bitten by a rattlesnake? Trust me, you don't want to.

Even if you manage to survive, you will be bored stiff as there is no culture here and nothing to do. Cuisine here consists of hamburgers or hot dogs and baked beans or, if you are lucky, french fries, which we still call Freedom Fries. Bloody Frogs. I have never seen a bagel. Also, did you know Rocky Mountain oysters aren't really oysters? WTF? Cultural activities are centered around rodeo and monster truck rallies. There are only two libraries and museums in the West and they both closed permanently due to covid.

Finally, there are the people. They are stupid. Dumb. Dumb. Dumb. There are no libraries so those few who are capable of reading can't read books, and there are no museums so those few who can appreciate culture can't go to a museum. These people are so stupid that they can't govern themselves so they have to import their political leaders from the coasts, much like provincial serfs in France or England. Take Colorado for example. It's previous governor was from Pennsylvania. The current governor is from California. The attorney general is from New York. Senator Bennett was born in India the son of an ambassador who had the good sense to send him to boarding school in the D.C. suburbs. Local schmuck Senator Gardner is about to get creamed in the 2020 election by said previous governor from Pennsylvania. Thank God these coastal elites have the charity and goodwill in their hearts to move here to provide political leadership to our state, and we all know they have our best interests at heart when they fly in to govern us before flying back to New York, D.C., or California to work for an investment bank.

We in the West love New Yorkers. We love your brash, loud voices and the way you talk over other people in conversations. We love hearing about the Mets and the Giants, and how much better your food is than our hamburgers, hot dogs, baked beans, and Rocky Mountain oysters. We'd love to have you all here, but for your own sanity and well being you really don't want to come here.

Sam L. said...

Anon, stop pussyfooting! Tell the TRUTH! Give us the REAL DIRT!!

bobby said...

"Just move the mentally ill. They don't belong on the street anyway. Move them to Sioux City, Iowa, or somewhere where the indigenous can get them back to nature."

Umm, speaking on behalf of the Sioux Cities of the country, no. Just, no.

RebeccaH said...

I have to agree with Anonymous. We just drove through the Intermountain West on our four-month RV road trip, and you coastal elites really shouldn't move there. You might have to mow grass (shudder), and there are no subways. You have to drive everywhere. I personally liked the hamburgers, hot dogs, freedom fries, and ... well, no, I can't say I really favor mountain oysters. And those elk and pronghorns and cattle everywhere, you don't want to get trampled by those herds. Also, they have singing cowboys. Best you stay where you are ... and, oh I don't know, maybe fix the problems you're trying to get away from.

Giordano Bruno said...

Ahem, may I take a moment to point out what Dixie will do to TriState refugees? Nothing is more inhospitable and backward than the American South.

We had several lynchings just last week and the good ol boys are circling the mule trails and dirt road byways looking for more carpetbaggers and shifty-looking men with swarthy complexions. They can't tell an Italian from a Jew, and they don't care. 3 Yankees were shot outside the Piggy-Wiggly just for failing to doff their hats to a white woman.

Mosquitos are big as your hand, armed hillbilly jug bands play on every corner when they are not shooting their guns in the air. There is a Baptist church every 300 yards filled with toothless creationists and Daughters of the Confederacy. They force their daughters into arranged marriages at 12 with old men. Polygamy is common outside the city limits, and one suspects inbreeding is widespread.

We banned books entirely in 1955, and the few people who do have cell phones listen to George Wallace speeches on the very popular Klan podcasts. Sunday morning, redneck Christian bigots go door to door and compel you to indicate to them what church service you plan to attend. Non-conformists are horsewhipped.

Dahlonega just uncovered mass graves filled with injuns and the mayor said that we could probably fit several more. The city has a sign on the road in warning all negroes to have their ass out of town come sundown. Black women and children are put into cages for walking funny.

The cuisine is nothing but camp beans, moon pies, and enormous servings of charred pig. They wash this gruel down with copious amounts of corn whiskey and kool-aid.

The whole place is like a Cormac McCarthy novel, but without the evocative prose. I suspect cannibalism is endemic. Several Chabad families have been missing for months.

Stay as far away from this hellscape as possible. It isn't even safe for Irishmen or Poles.

I hear good things about Gary, indiana.

DCE said...

Don't come to New Hampshire.

We have 9 months of winter and 3 months of construction. We don't do veggie burgers, sushi, or tiramisu. You'll need to get used to venison, bear stew, and trout as well as poutine. Pizza or Chinese food delivery? In your dreams.

You will need a vehicle with 4WD if you want to be able to get out of your driveway...even during the 3 days of summer.

Everyone carries guns. If the coyotes and bears don't get you, the mountain lions and timber rattlesnakes will. You are held responsible for your own actions.

You'll be expected to cut, split, and stack your own firewood.

Internet service consists of dial-up or DSL. Cell service? Yeah, right.

So don't come here.