I have lost the will to live... There is no easy way to say it: driving in Miami has simply beaten the life out of me. Over the past 18 months I have run the commuter gamut of emotion including shock, anger, dismay, annoyance, misery, and flat-out fury.
Before I get into my most recent mental-state, let me just step back a second and provide a backdrop explanation of driving in Miami. You know, for those who have never enjoyed the...um...pleasure themselves. Let's take a look at the relevant players on the Miami driving scene: 1) the elderly -- always a joy to see 80-yr-olds with the huge blocky sunglasses behind the wheel who can't see above the dashboard. they are solid decision-makers. 2) the cabbies -- let's just say that the Russian and Haitian guys that make up the bulk of Miami taxi drivers are not quite as sharp as their northeastern compatriots. I learned this firsthand when, on one of my first commutes before my car had arrived from NYC, the cabbie turned back to ask me (sitting behind him diagonally) how I liked the city while simultaneously turning the wheel completely in the direction of his head turn, thus traversing across 4 full lanes at roughly 35mph, nearby cars be damned. He noticed my gasp and my weak forced smile, "righted" the ship, and continued to break a series of traffic laws as I actually directed him on which streets in Miami to take. He had no idea how to get anywhwere, and this is a recurring cabbie theme. 3) the rich - utterly, totally, and completely above the law, in their minds. 4) the locals - usually Hispanic in background, many locals are simply on tropical time. manana, baby, manana. what's the rush? ever? 5) everyone else, and by that I mean the texters, the tweeters, and the cell phone users. I am dead serious. 75% of drivers in Miami are doing one of these things while driving. Yes, I have seen it cause accidents. And yes, I am aware it is illegal almost everywhere else. But of course, not Miami. In fact, here's the list of countries where it's illegal: Australia, Austria, Belgium, Brazil, Chile, China, Czech Republic, Denmark, Egypt, Finland, France, Germany, Greece, Hong Kong, Hungary, India, Ireland, Israel, Italy, Japan, Jordan, Netherlands, Philippines, Poland, Russia, Singapore, South Africa, Spain, Sweden, Switzerland, Turkey, United Kingdom. Further, cell phone usage of any kind is illlegal in many states and almost all states regulate usage (by fine or outright ban) in some way. Except? Florida. WHY?? I can tell you in all seriousness that watching people zoom by on I-95 at 80mph while arguing with one hand on the wheel and the other holding the phone, or texting while holding the wheel with one pinky and only glancing up at the road scares me to death! I have never been afraid of driving in my life before...in fact, I relish the challenge that is Manhattan driving: it is competitive, it has unspoken rules, cabbies are incredibly deft and skilled, and it is actually safe - especially relative to the number of cars and pedestrians on the roads. But Miami makes me think it is only a matter of time before some complete idiot hits me through no fault of my own...and there will be nothing I can do about it.
So, moving on...there's more. Timed lights in Miami? Nope. If you catch a string of lights that actually keeps heavy commuter traffic flowing at snappy speeds, go buy a lottery ticket too, because it's that rare. More often than not, your light will turn green just as the light 20 yards ahead turns red. And yes, many cross streets are that close together. Speaking of green lights, can you guess what people do at green lights in Miami? If you guessed "immediately go," you'd be wrong. No, in Miami green typically means, "turn to the person next to you and finish your conversation, and then go," or "finish off that text, then go," or "apply another layer of make-up, and then go," or "pause to take another swig of coffee/milk/OJ, then go" (this one happened in front of me last week), or - my personal favorite - "simply stare directly at the green light and for no apparent reason whatsoever, other than to annoy everyone around you who actually has someplace to be, seemingly count out one-Mississippi...two-Mississippi...and then proceed forward at an absolute crawl."
Additionally, driver skill levels are an an all-time low in the Miami area. I respect the ability of NYC drivers, for example, to make bold moves that border on illegality yet are ultimately efficient, and thus probably justified. Driving in New York, one actually applauds those moves, and probably follows along if the opening is still there. It's a respected sport. Here? No such luck. I honestly don't know how people get driver's licenses in the Miami-Dade area. Looking both ways? Forget it. Parallel parking? Not a chance. Cutting off oncoming traffic with no regard for safety whatsoever? Hell yeah. Swerving across lanes - in fact, swerving across lanes and coming to a complete stop and thus stopping all traffic behind you for blocks and blocks until someone lets you in to make your turn? Absolutely - that happened in front of me this morning!! Don't believe me on any of this? Well, if you are ever in the area, just watch the evening news or pick up the paper, and count the number of fatal accidents that occur on Miami roadways... Frightening.
Part of the problem - I think - must be the element of "self-policing." Because, let's face it, the cops in Miami could care less about traffic violations. As a result, Miami drivers are basically left to their own devices. But then again, so are New Yorkers...so what's the difference? Self-policing citizenry, I say. Anytime someone does anything remotely stupid on a Manhattan street, somebody - pedestrian, bike messenger, fellow driver - yells out "yo, Moron...whaddayou doin'?" Horns honk, people glare. And the accused usually addresses the mistake. It actually works! But in Miami...horns never honk. People never yell. I mean, a car can flat out stop in the middle of a busy street, while cars flow around it (except those directly behind) like a boulder in a stream, and no one says a damn thing. It's unreal. There is a very tight turn in the heart of downtown Miami...people take it relatively fast...and knowing this, cars nevertheless just stop on either side of this turn (it's one way) to let people off for work, to say hello, to honk at a pretty girl. It's insane. I want to yell out "what the f*&k are you doing stopping there??!!" I want other people to join me. I want Miamians to start policing themselves. But this never happens. A Cuban guy I was in PT with shared an interesting potential explanation with me. In his words, many of the immigrants here are "savages" from Central America (HIS WORDS!) with no regard for anyone...add this knowledge to a prevalence of tinted windows...and incredibly liberal gun laws...and he says people fear correcting anyone else because there have been plenty of "shooting incidents" in the recent past. So instead, everyone stays quiet... Hmmm. I'm still a newbie, so anything is possible. He makes a good point though, so from now on I make sure the windows are not tinted and I can make a best guess as to whether the driver is packing heat before I start cursing...
I have saved the best for last, though. The absolute bane of my commuting experience: Miami bridges. Don't get me wrong...Miami is beautiful, and in its defense, it has probably grown well beyond anything its infrastructure can handle. I doubt anyone ever imagined this as a major metropolitan area with over 5 million people, many of whom commute to downtown. (This also explains why there is no easy route south to Coral Gables and Coconut Grove, and all traffic is channeled into a forced bottleneck of insanity called U.S. 1. Never, ever, drive on this road if you visit Miami. Use a GPS - whatever it takes - and stick to the side streets.) So, as a result of a lack of proper urban planning (I get the sense Miami just "sprawled" with time...there was probably no one laying out a grid, developing large avenues and boulevards like many northeast cities, etc.) one would think that Miami would make up for this deficiency by making sure lights were timed and other "simple" rules were followed. For example, here's an easy one - and this brings me back to the opening of this section and the most infuriating thing of all: how about "no boat traffic in urban areas from 7am to 9am." Yeah, you heard me right. "Boats in urban areas." Here's what happens: at the height of rush hour, on demand, Miami will raise a drawbridge for the most piddling of sailboats to the largest of yachts to head in or out of the Miami River... this process takes 15-20 minutes from red light (bridge up) to green light (bridge down) and does much worse damage than that considering the backlog of commuting traffic that develops. Some bridges you can work around, because if they open (if there's a boat), they open on the hour and the half-hour. Of course, the bridge outside my apartment (and yes, directly in my path to work - my only path to work) opened yesterday at 7:40am instead of 8:00am. Was there an emergency? Was it the Coast Guard? (Valid exemptions) Nope. This is another Miami specialty. The bridge was opened with a shrug and a "whatever," and the entire Venetian Causeway was backed up for 20 minutes for absolutely no good reason. Other bridges are just a game of chance. Sometimes they are up and you are screwed. Other times, no. There is simply no rhyme or reason that I can decipher. What I love, my absolute favorite, is when the Miami River bridge goes up for the retired guy headed out on his little sailboat for a day of fishing. Yup, he gets the right of way over the roughly 5,000 cars that end up stuck in a one square mile area. Unreal. In any other major city this is considered insanity. What's the solution? Hey Miami: You are no longer a sleepy little fishing town. It's not 1920. CARS SHOULD HAVE THE RIGHT OF WAY FROM 7AM TO 9AM AND FROM 5PM TO 7PM! Is this that difficult?
So yesterday I waited at one small bridge near my apartment from 7:40am to 8:00am...then I caught the tail end of the Miami River Bridge from 8:05am to 8:10am...then I caught the bridge up from 6:30pm to 6:45pm on the way home...and this morning? Yup - caught it again: 7:50am to 8:05am right smack in the heart of downtown.
There you have it. I give up. Miami, you win. I have nothing left. I have become one of the non-honking, non-moving, non-thinking drivers. Congratulations. But you'll never see me on my phone. That's just idiotic.
Friday, October 16, 2009
Futures -60bps as markets digest recent earnings and USD strength weighs on equity performance. Relative to earnings, premarket activity shows GE is trading down 4%, IBM is down 4.5%, BAC is down 4%, and GOOG is the lone bright spot, up 3%. Google’s release was particularly upbeat, as commentary included talk that the worst is behind us and that they will ramp investments in growth. BAC’s earnings may be particularly troubling, bucking the trend in financials set by GS and JPM yesterday. GE’s weakness is generally attributed to lower-than-expected revenues across all sectors of the business. Taking a step back for a broader view of where we stand in “recession recovery” terms, here’s a quick look at simple year-over-year revenues recently reported: INTC -8%, CSX -23%, ABT +3.5%, JPM +3.9%, GWW -13.5%, XLNX -14.2%, C +25%, CY +15%, FCS +20%, GS -10%, NOK -20%, SWY -7%, AMD +18%, GOOG +8%, IBM -7%, BAC +32%, HAL -26%, MAT -8%.
Options expiry today may result in some larger-than-expected opening and closing prints, thus volume may be deceptive. The market continues to feel slightly shaky from my view in the cheap seats. Volume has not necessarily confirmed the highs over Dow 10,000 and there are hints of concern among “smart money” investors. One thing worth considering: If markets do in fact pullback (and there is no guarantee they will), it could be a violent move, simply because the rush to the exits – the rush to lock in profits given the importance in career/performance/track-record/highwater marks across the hedge fund sector in particular – could be an incredibly crowded trade. To be honest, that latent potential scares me. To follow on that bearish theme, here’s an interesting technical analysis story from Bloomberg this morning:
Standard & Poor’s 500 Index may be due for a “stiff” slump as it approaches a resistance level in coming weeks, according to Nader Naeimi, a strategist at AMP Capital Markets, which holds assets worth $75 billion. The U.S. index’s 62 percent rally from its March low has brought it close to 1,121.4, which Naeimi says represents the 50 percent level Fibonacci analysts identify as a key resistance point. The performance of the index, which closed at 1,096.56 yesterday, is also diverging from measures of price and breadth momentum, pointing to a deeper “correction” than those that have occurred since the rally began, the strategist said. “The divergences have started to build up over the past few weeks,” said Sydney-based Naeimi, whose firm went to “overweight” from “underweight” stocks in March. “The new highs the index is making aren’t being confirmed by the measures of momentum. The next push higher is likely to extend those divergences, which suggests we’ll see a deeper correction that lasts several weeks or longer, rather than just days.” The S&P 500 slumped 38.5 percent last year as the financial crisis deepened, tipping nations into a global recession. The index has rebounded from a more than 12-year low on March 9, as government stimulus measures helped calm credit markets and shore up economic growth. The S&P 500 may climb to the critical 50 percent Fibonacci level in the next few weeks, at which point a slide of between 10 percent and 15 percent is likely, said Naeimi. That’s deeper than three previous “corrections” that have occurred since the rally began in March, the strategist said. The first was a 5 percent drop between May 8 and May 15, followed by a 7.1 percent slump between June 12 and July 10, and a decline of 4.3 percent between Sept. 22 and Oct. 2. “We will see multiple negative divergences as the S&P 500 hits a new cyclical high,” said Naeimi “All the conditions for a stiff correction are in place. The cyclical bull market will continue once the correction has run its course.” U.S.
Here’s another gloomy Friday quote, from across the Pond in the
The British people are living in a fool's paradise and have yet to understand the gravity of the economic crisis, according a former head of the FSA, the Telegraph reports. Sir Howard Davies, now Director of the London School of Economics, said
faces a dangerous rise in the levels of public debt - even taking into account tax increases planned for coming years. Britain
See quote section below for interesting article on
real estate. AMD trading lower on earnings beat. NY Post reports KFT may sell Maxwell House to SLE to perhaps help finance the Miami CRBY LN purchase. EL pre-announces higher guidance ahead of 10/30 earnings. CSFB ups MAS, CYT. CSFB positive on Gold, GPS. MAT slightly higher on earnings. ARO initiated Buy at Auriga. WAG upgraded at UBSS. Cramer cautious on YUM, JNJ last night. BofA/MLCO ups AUDC, BCAP ups TEX. JPHQ ups CATM. KBWI ups CME, ICE. UBSS ups HUBG. CITI ups LCAPA. GS ups WSM. JPHQ cuts ATI, SGMS. KBWI cuts GFIG, NDAQ. OPCO cuts FFIV. BARD cuts SHAW. Barron’s positive TIF. HAL higher on earnings. LFL, MAN.
Important earnings to consider for next week include ETN, AAPL, BSX, TXN (Monday), LMT, BTU, PFE, UTX, STM (Tuesday), MO, BA, LLY, FCX, MCD, NOC, USB, AMR, ADS, AMGN, CTXS, MS, RHI, TER (Wednesday), MMM, T, BMY, DOW, EMC, HSY, KMB, LM, MRK, PM, POT, RAI, HOT, UPS, AMZN, AXP, BRCM, COF, JNPR (Thursday), HON, ITT, MSFT (Friday).
Brightpoint PreMarket (yest close/premkt/% change/volume):
S&P 500 PreMarket (last/% change prior close/volume):
MGIC INVT CORP 6.27 -14.34% 99970
ADV MICRO DEVICE 5.81 -6.14% 722933
ESTEE LAUDER 41.44 +5.93% 22500
17.19 -5.03% 30644344 AMERICA
CIT GROUP INC 1.13 -4.24% 772770
IBM 122.61 -4.2 % 307454
GENWORTH FINANCI 11.50 -4.17% 69938
LIZ CLAIBORNE 7.20 -3.87% 16271
SYMANTEC CORP 16.09 -3.71% 340300
MATTEL INC 20.30 +3.68% 144487
MBIA INC 5.70 -3.39% 7483
FANNIE MAE 1.48 -3.27% 528147
GOOGLE INC-CL A 547.05 +3.23% 116975
KEYCORP 6.45 -3.01% 10830
Today’s Trivia: Speaking of US states…where was the very first gold deposit discovered in the
, and when? US
Yesterday's Answer: The original 13 include NY, NJ, MA, CT, MY, NH, VA, DE, GA, NC, SC, RI, and PA.
Best Quotes: “Buyers Suing Trump in
Condo Glut as Values Return to 1989 (2009-10-16 04:01:00.16 GMT) Miami
By John Gittelsohn
Oct. 16 (Bloomberg) -- Robert Cooper says he has found a way to make money in
South Florida’s real estate bust.
Cooper, an attorney in
, sues for refunds on deposits in the nation’s largest condominium market. In the last two years, he filed lawsuits for about 1,500 buyers against companies and individuals including the Related Group of Florida, Dezer Development LLC, Corus Bankshares Inc., Donald Trump. Aventura, Florida
More suits seeking refunds under a federal law regulating condo sales have been filed in
South Florida than in the rest of the country combined, according to a search of federal court records. Fueling the litigation is a price crash that makes buyers unwilling to pour more money into bad investments -- even if they can get financing. Condos on which they made deposits of up to $1,000 a square foot in 2006 are now selling for $125 to $350 a foot, said Jack McCabe, a real estate consultant in . Deerfield Beach, Florida
“If you’re thinking you can come here and buy and sell condos for a profit in less than five years, you’re sadly mistaken,” said McCabe, whose clients have included Credit Suisse Group AG and Pulte Homes Inc., the largest
homebuilder. “You need a seven- to 10-year range.”
Prices could fall to $100 a foot, less than half the cost of construction, and a value not seen in 20 years, he said.
In Dade, Broward and
Palm Beach counties, there are more than 43,000 condos and townhouses on the market, almost 1-1/2 times the number of single-family homes, according to Condo Vultures LLC, a real estate brokerage. In downtown Bal Harbour , more than 8,000 condos stand vacant and unsold, relics of a building binge that added 23,000 condos from 2003 to 2008, said Peter Zalewski, principal of Condo Vultures. Miami
Over the past 12 months, condo prices fell 15 percent in the West Palm Beach-Boca Raton area to a median of $112,200, 36 percent in
Fort Lauderdale to $85,100 and 31 percent in to $144,700, according to Florida Association of Realtors data. Miami
Those prices are likely to fall more when the $1 billion portfolio of South Florida condos financed by Corus Bankshares, the
lender seized by federal regulators, goes on the market, Zalewski said. Chicago
Investors led by Starwood Capital Group LLC won a bid for Corus’s loans. Two-thirds of the 2,537 condo units Corus financed in downtown
are unsold and unoccupied, Zalewski said. Miami
For Cooper, fighting over the spoils is a full-time job.
Cooper said he has reached out-of-court settlements in disputes over 500 deposits, recovering about half of his clients’ money.
He won’t say how much the refunds total or how much he has earned in contingency fees, which are usually about one-third of the recovery amount.
“There’s no recession in the real estate litigation community,” said Cooper, 46.
“Condos were extremely attractive because you could put down a modest down payment and leverage it extremely high,”
Brad Hunter, chief economist for Metrostudy, a Houston-based real estate research company, said from his office in
. “If you were investing between ‘03 and ‘05, you were able to see West Palm Beach 100 or 200 percent appreciation. Ninety percent or more of it was speculation.”
The global recession, the credit crisis and tighter bank lending put an end to
’s condo growth. Miami
Buyer Pockets $315,000
In February 2005, Randy Gerlick of
Parkland, Florida, put a 20 percent deposit on a $700,000 condo at the Las Olas Beach Club in . Two years later, he sold the unit for Fort Lauderdale
$1.1 million, receiving a check for $315,000 after paying fees.
He never set foot in the condo.
Then he heard about the Trump International Hotel & Tower Fort Lauderdale, a luxury 298-unit development on the beach.
Gerlick put down a 20 percent deposit, or $122,000, for a unit.
As a token of the deal, he got a silver Tiffany & Co. key chain engraved with the Trump International logo and his unit number, 1009.
“Trump seemed like a natural next step,” Gerlick said in a telephone interview. “It was like, how can you lose with his name on it?”
On May 13, the Trump International’s developer, SB Hotel Associates, sent Gerlick a letter giving him until May 29 to obtain financing or lose his deposit. The letter said the hotel portion of the property wouldn’t open if less than 50 percent of condo buyers completed their purchases. It also noted that the Trump affiliation was in jeopardy under an agreement that allowed the
developer to withdraw his name from the project. New York
Gerlick’s lawyer, Jared Beck, filed a breach-of-contract lawsuit seeking deposit refunds from seven defendants, including SB Hotel, Corus, Trump and the Trump Organization.
In the complaint, Beck says the prospective owners are owed refunds in part because of deceptive advertising and promotional materials that led investors to believe Trump was integral to the project. The Trump brand added $200 a square foot to the project’s value, the suit said.
“This is one of a lot of cases where the disclosure wasn’t full or fair to the buyer,” Beck said in an interview.
SB Hotel and Trump moved to dismiss the suit, arguing they are protected by the purchase contract. Trump was involved in name only, said Alan Garten, assistant general counsel for the Trump Organization in
. New York
“The main point is that we are not the developer of this project. We are just the brand which licensed the use of the Trump name,” Garten said. “Trump didn’t enter into contracts with any of the buyers or receive deposits from any of the buyers.”
The purchase contract says Trump maintains the right to sever his association with the project, Garten said.
“If you’re not going to read the contract, don’t sign it,” Garten said.
Harvard Law School graduate who has filed suit for buyers of about 500 South Florida condos seeking deposit refunds, said the cases are part of the market correction.
“We’re going to have lots of litigation as long as there’s a disconnect between what people are under contract to pay and what the market actually is,” Beck said.
“During the boom, developers and lenders were falling all over themselves to get projects up and sold as soon as possible, applicable statutes and disclosures be damned,” he said. “The law took a back seat. The only time laws are going to be enforced is when the market’s bad. That’s what we’ve got here.”
One of the most common laws cited in deposit recovery suits is the Interstate Land Sales Full Disclosure Act, a 1968 federal law regulating housing projects with 100 or more units that requires developers to provide detailed reports describing the size, scope and delivery date of marketed projects.
Since Jan. 1, 2008, 62 percent of the 215 lawsuits filed in federal courts under the Interstate Land Sales Act were filed in the Southern District of Florida, according to court records. The suits argue developers committed fraud because projects were not delivered as promised.
Betsy McCoy, assistant general counsel for the Related Group of
, which has developed and managed more than 55,000 condominiums, said the deposit lawsuits strain legal reasoning and offer false hope to investors facing losses. The Related Group faces 361 deposit refund lawsuits among 874 contract disputes with condo buyers, McCoy said in an e-mail. Florida
“We have settled some lawsuits, but not many and settlement is typically payment of limited remedies the contract provides,” McCoy said. “We have not found suits to be compelling, either factually or legally, to justify settlements in any manner that exceeds the contract terms.”
People with pre-construction deposits have a legal right to refunds of no more than 5 percent of the purchase price of the condo, McCoy said.
On Sept. 30, the
11th Circuit Court of Appeals ruled in favor of a developer, reversing a lower court ruling that awarded a deposit refund under the Interstate Land Sales Act. U.S.
“All bubbles eventually burst, as this one did,” the three-judge panel said in its opinion. “The bigger the bubble, the bigger the pop. The bigger the pop, the bigger the losses.
And the bigger the losses, the more likely litigation will ensue.”
The federal appeals court opinion will encourage lawyers to file more suits in state courts, where judges have been more sympathetic, Beck and Cooper said.
Lawsuits are one of the costs of doing business when times are bad, said Gil Dezer, president of Dezer Development, developer of the Trump Royale, part of the Trump Grande Resort & Residences in Sunny Isles, north of
“Those lawyers are trying to throw as much out as they can to see what sticks,” Dezer said in a phone interview.
All 380 units in the Trump Royale, which licensed the Trump name, were pre-sold at an average price of $1 million each, Dezer said. About 180 of the units have now closed and others are selling at a pace of three or four a week, Dezer said. The current average price is $950,000, he said.
Owners of 17 condos are named plaintiffs in a suit in Miami-Dade County Circuit Court against the Trump Royale, which Cooper filed. Among the allegations: The developer breached the purchase agreement because the Trump Royale’s unit numbers led buyers to believe they were buying units near the top of the
55- story tower.
“The plaintiffs never knew that units 3301 and higher are actually 10 floors lower than what the developer represented,”
the lawsuit argues. “For example, unit 3706, plaintiff Sanchez’s unit, is actually located on the 27th floor.”
Dezer said he numbered the units to reflect the building height rather than the number of floors. A judge dismissed two counts of the complaint on Sept. 15. Cooper filed a motion for reconsideration.
During the boom years, Cooper said he represented clients who sued to buy condos, which they claimed had been sold out from under them -- after they signed a contract -- to people who offered a higher price.
“This was not a normal real estate market,” Cooper said.
“People were going crazy.”
“As many cases as we settle, we get more new active cases,” he said.