The drip, drip, drip of the finance industry’s exit from New York and California has been measured anecdotally, one at a time, these past few years. Elliott Management decamped to West Palm Beach. AllianceBernstein to Nashville. Charles Schwab moved to suburban Dallas.
Now, for the first time, there are hard numbers quantifying the exact scope of the exodus. Both states have in the past three years lost firms that managed close to $1 trillion of assets, Bloomberg News calculated after going through corporate filings from more than 17,000 firms since the end of 2019.
The exodus from the Northeast and West Coast has meant the loss of thousands of high-paying jobs, straining city and state finances by sapping tax revenue. Commercial property markets have also lost valuable tenants at the same time they’ve been struggling with the new realities of hybrid work.
· Romance reached over 39 million printed units sold over the last 12 months as of May 2023.
· Romance sales grew by 52% compared to the 12 months ending May 2022, and this has been the third consecutive year with positive growth in romance novel sales in printed format.
· Sales of romance novels more than doubled compared to 2021 figures (12 months ending May 2021).
· Over 33% of books sold in mass-market paperback format were romance novels.
10. This Is How To Succeed Under Pressure: 4 Secrets From Astronauts
Eric Barker
This is how to succeed under pressure:
“Okay, what’s the next thing that will kill me?”: Negative thinking can be a positive during a crisis. When you’re facing a perverse all-you-can-eat buffet of misery, anticipating problems and finding solutions is a superpower, while “thinking it will all work out” leads to a passive demise.
“Sweat the small stuff”: Prepare. And then prepare some more. You may think you’re busy now but you will always have more time before a problem strikes than when you’re in the middle of it.
“Working the problem”: Find a way to safely experience the challenge before it ever hits. May sound like the emotional equivalent of chewing aluminum foil but nothing beats the understanding and experience from having dealt with a problem previously.
“How can I help us get where we need to go?”: Yes, it seems like some people are only here to give you a head start on a midlife crisis. The first thing is don’t make things worse. Don’t be afraid to be a big steaming pile of mediocrity at first. Be competent and trustworthy and then find the best way to be a “plus one.”
1. Stock Bond Ratio Breaks Way Above 25 Year Range
Callum Thomas Chart Storm Stocks vs Bonds: As a continuation or different angle on the previous chart, this one shows just how sharp and stark the disconnect between stocks and bonds has become — thanks to the most catastrophic run of performance for treasuries in recent history, stocks have absolutely smashed bonds on a relative performance basis. But to pause and reflect, this chart does NOT look sustainable. https://www.chartstorm.info/
2. Huge Spread Between Nasdaq and Russell 2000 Small Cap 2023
From Dave Lutz at Jones Trading
3. Analysts Raise Forward Earnings Estimates
4. China High Yield Real Estate Chart
Callum Thomas @Callum Thomas (Weekly S&P500 #ChartStorm) Next Shoe to Drop: Aside from the tech/rates aspect, also lurking in the background is increasingly bad macro in China. Now eventually this may become a case of “bad news is good news” when/if China opts for large scale stimulus to avert a deflationary spiral, but I would say until then it’s probably going to be a case of bad news is bad news (at least for those actually paying attention).
2. Technology Sector Forward P/E vs. Remaining S&P
JP Morgan Private Wealth
3. Semiconductors Forward P/E Ratios Trading in 99th Percentile vs. 10 Year History
Marketwatch BCA Research has downgraded the semiconductor sector to underweight, and the charts below help explain why. Chip prices are falling pushing sales drastically lower, but share prices have done well.
“Demand for AI chips remains strong, but it does little good to most chip companies except Nvidia and AMD. TSMC said that AI chips account for only 6% of its sales,” says BCA. “The industry trades at 28.5x forward earnings, which is the 99th percentile relative to 10 years of history. The BCA Valuations and Technical indicators signal that the industry is both overvalued and overbought relative to the S&P 500. “
Tiny homes are being developed near Converse, where Lennar Homes continues to rapidly expand into various markets centering around San Antonio. Credit: Scott Ball / San Antonio Report
With a small yard and inviting front porch, the newly built houses along a short street in an established neighborhood in far northeastern Bexar County have all the trademarks of a single-family home.
What makes them unusual perhaps, at least for a house in San Antonio, Texas, is the minimal size of not just the house but also the lot. Another key difference: the price tag of just over $150,000. More small-home developments like Elm Trails could be coming as the solution to a nationwide housing shortage and the rising cost of building materials. But only if cities allow it.
Miami-based homebuilder Lennar Homes started construction months ago in the Spring Meadows subdivision near Converse, building two styles of detached homes that range between about 350 and 660 square feet — a size that’s comparable to a studio apartment. At least 30 are in various stages of construction in Elm Trails. A total of 100 houses eventually will be built.The two-story homes come with one bedroom and one or two bathrooms, depending on the model, and an open floor plan with a fully-equipped kitchen. In the Cooley model, a built-in ladder is used to access the upper-level open space, and in the Henley, a narrow set of stairs leads to a sitting area and bedroom.
The houses stand side-by-side along a street named Elm Cove, two-tenths of a mile long, and three smaller streets. The homes are built on lots that measure about 20 feet across, leaving a narrow space between each residence. Building codes in Converse, as in San Antonio, require most new single-family homesites to be a minimum of 60 or 65 feet wide, with some exceptions.But Elm Trails is outside of city limits, where lot size is not regulated.
Not bigger in Texas San Antonio is the first city where the nationwide homebuilder has built its small-scale homes, said Brian Barron, San Antonio division president for Lennar. “We’ve been working on bringing these homes to market for the past two years or so,” Barron said. “We took what we had seen nationally with the growing acceptance of small-footprint homes and began researching what it would take to do that across an entire community.”
The National Association of Home Builders reported in November that the median size of new family homes is 2,276 square feet, down from a high of about 2,700 square feet in 2015. Rising interest rates and construction costs are partly the reason for the trend toward smaller homes.
Small-home developments could be the answer to housing shortages and rising costs. But zoning is often a roadblock.“As more and more municipalities address affordability, we believe it will be important that traditional zoning requirements are updated to reflect new types of housing,” Barron said.While Elm Trails is a full residential development made up of tiny homes, the prevalence of small
Raw talent/intelligence – Some people are just naturally better and smarter.
Hard work – Some people work harder.
Differentiation – Seeing the world differently. Doing something different. Reading different books. Interpreting the same information differently.
Process / Discipline – Creating a process and following it. Working out every day is a great example.
Talent Collector – The ability to hire the best people and get the most out of them.
Patience – A lack of patience changes the outcome.
Ability to take pain – Are you willing to look like an idiot to get better? How much risk are you willing to take, AND, importantly, can you handle the losses?
Temperament – Keeping your head when everyone else is losing theirs.
13.3% of US goods were imported from China during the first six months of 2023, the smallest percentage in 20 years.
Mexico is now the #1 trading partner with the US, followed by Canada. China, which held the top spot from 2015-2018 and again in 2020, has dropped down to third place.
7. Weekly Gasoline Prices Rise for 6th Straight Week
Advisors Perspectives Blog by Jennifer Nash As of August 14, the price of regular and premium gas each rose by 2 cents and 3 cents, respectively, from the previous week. According to GasBuddy.com, California has the highest average price for regular at $5.11 and Mississippi has the cheapest at $3.29.
While fitness watches offer an estimate of your VO2 max, they might not be as accurate as an actual test.
DREAMSTIME
When it comes to fitness and even longevity, there is one number to rule them all: VO2 max.
The number measures the maximum amount of oxygen a person can use during intense exercise. A person awaiting a heart transplant might score below 10 while a world-class endurance athlete might be above 70 or even 80. Many health experts consider it the single best indicator of cardiorespiratory fitness, and research has found it correlates to longevity as well.
“The relationship between VO2 max and all-cause mortality is quite good,” says Dr. Michael Joyner, an anesthesiologist and fitness expert at the Mayo Clinic. “The odds of dying in the next 10 years are markedly low if your VO2 max is high.”
So what is VO2 max and why is it such a good measure of total health?
For starters, the test measures how multiple systems of your body function during hard exercise, including your heart, lungs, muscles, and veins, according to Dr. Kerry Stewart, a clinical and research exercise physiologist at Johns Hopkins School of Medicine. People who score well are less likely to have diabetes and high levels of LDL, or so-called bad cholesterol, and more likely to have high levels of HDL, or “good” cholesterol.
The American Heart Association in 2016 issued a scientific statement recommending that an assessment of cardiorespiratory fitness be considered a key vital sign in evaluating a person’s heart disease risk and overall health. It said that cardiorespiratory fitness was “was a potentially stronger predictor of mortality than established risk factors such as smoking, hypertension, high cholesterol, and Type 2 diabetes.”
High cardiorespiratory fitness is also linked to lower rates for certain types of cancer, according to the National Cancer Institute. It also appears to help people already diagnosed with cancer. “Research findings have raised the possibility that physical activity may have beneficial effects on survival for patients with breast, colorectal, and prostate cancers,”the institute said.
The positive news is that you can increase your VO2 score. How? By exercising. The harder you push yourself, the more you can improve your score. Even brisk walks around the neighborhood could lift the scores and health of millions of inactive Americans.
How can you measure your VO2 max? The most accurate tests are done in a laboratory where you are hooked up to a mask that measures oxygen consumption as you exercise. If you are on a treadmill, you are told to walk or run faster and faster until your oxygen consumption stops rising. If you go beyond this point, you will increasingly be using anaerobic energy—which doesn’t burn oxygen—and you will have trouble sustaining it for long periods.
Today, some fitness devices, including Apple Watch and Fitbit, can estimate your VO2 max score based on your heart rate and, in some cases, the speed you are moving. They aren’t as accurate as a laboratory VO2 max test, say doctors Joyner and Stewart. “They are reasonable estimates based on reasonable algorithms,” Joyner says.
VO2 is commonly measured in milliliters of oxygen consumed a minute per kilogram of body weight. An average adult might score 35. Endurance athletes can be twice that or even higher.
Sometimes, cardiorespiratory fitness is expressed in METs, a measure of metabolic energy. (METs are calculated by taking your VO2 max score and dividing it by 3.5.) One MET is the amount of oxygen a person uses while seated and at rest. If your exertion level rises to two METS, that means you’re using twice as much oxygen. A VO2 max of eight to 10 METs is considered healthy for an average adult, while one of less than five METs is considered worrisome.
“People who have more severe disease generally can’t achieve five METs worth of work,” Stewart said.
Women, because they tend to have less muscle per kilogram of body weight than men, usually score lower, though the best female endurance athletes still post high numbers. And just as with men, higher VO2 scores for women correlate to athletic performance and mortality.
VO2 scores decrease as people age because their maximum heart rate declines and they lose muscle mass and thus burn less oxygen. So a score that would be low for a woman in her 20s might be an elite score for a woman in her 70s.
To calculate VO2, The Apple Watch uses a combination of heart rate, weight, age, other personal information and walking or running speed to measure cardiovascular fitness. It is accurate within an average of one MET of an actual VO2 max test, according to Apple.
If you walk on sand or uphill or anything that makes walking or running more arduous, that will make your Apple Watch VO2 max score appear worse. Also, if you take medicines that slow your heart rate like beta blockers or calcium channel blockers, it will make your score appear better. The Apple Watch asks you to list any heart-slowing medicines, and then makes adjustments for them.
It used to be that you had to exercise to calculate VO2 max on an Apple Watch. But an Apple watch is now set up so that you can get a score from walking around. Your score appears in the Apple Health app, in the heart section under cardio fitness.
Fitbit also estimates your VO2 max score from your resting heart rate, age, sex, weight, and other personal information, and uses it to calculate a fitness level between one (poor) and six (excellent). If your Fitbit connects to GPS, you can obtain a more precise score by going on a run.
How hard is it to improve VO2 max score? That depends on your fitness level. Someone who is inactive could improve their VO2 max through moderate exercise and make a significant improvement in their health.
Fit people have to push harder. That means either exercising longer or exercising harder. Or both. The Center for Disease Control recommends that adults get 150 minutes of moderate exercise or 75 minutes of vigorous exercise a week. You can get additional health benefits by doing two or even three times as much exercise, but there are diminishing returns. Dr. Joyner says, “You get 70% to 80% of the benefits by following the CDC’s basic guidelines,” he says.
Lifting weights can also help your VO2 score. That’s particularly true for older people who have lost muscle mass and replaced it with fat. Weights can help reverse that process.
And one of the fastest ways to improve your VO2 max is to lose weight.
For those who are serious about improving their VO2 max, Joyner recommends that they add interval training to their routines. A popular approach now is 4×4 interval training, where you do four intervals of intense exercise, separated by rest between each interval.
“In general, for any person to reach their personal biological upper limit, they need to do interval training,” Joyner says.
Corrections & amplifications: Kerry Stewart is a clinical and research exercise physiologist at the Johns Hopkins School of Medicine who does work in cardiology. An earlier version of this article incorrectly called him a cardiologist.
The Daily Stoic Those shoes you’re wearing were likely made in a sweatshop by a child in horrendous labor conditions. That luxury handbag is a few dollars worth of leather and a fortune in deceptive advertising and branding. Those two politicians with radically different agendas are ladder-climbing friends behind the scenes, with the same corporate donors. Those big tough rappers whose beef you’re following are two poets laughing all the way to the bank. That fancy car will not only lose half its value when you drive it off the lot…but many of the cars on that same lot share the same chassis, were made in the same factories, and cost a lot less. Those songs were written by teams of songwriters, the pop star given public credit to preserve their ‘authenticity.’ That ripped actor is on steroids, that beautiful actress had plastic surgery and her images are photoshopped…and by the way, both of them are thrice married for a reason.
This list–not a conclusive one by a long shot–is not a morning dose of nihilism. It is, however, an exercise that Marcus Aurelius tried to practice in his own way. This expensive wine, he noted, was just rotten grapes. This sumptuous dish was actually a dead pig. The brilliant purple of the emperor’s cloak was dyed with shellfish blood, made by miserable slaves.
What Marcus was doing, what we can do, is “stripping things of the legend that encrusts them.” He was using the power of his mind to rip the polish off, to remove the branding, to take things down to their studs. So he could see what was really happening, that he was deceived, puffed up, tempted. Materialism, injustice, our lower urges–these things depend on legend and myth and marketing. They depend on a false picture, an inflated sense.
To act rationally, to know what matters, to do the right thing, to remain self-contained, we need to tear that down. We need to remind ourselves what things are and what they’re made of.
1. Tech Stock Valuations Back to 2021 Highs Based on 12 Month Forward Earnings
Callum Thomas Tick Tock Tech Top: Case in point — tech valuations got back to those crazy 2020/21 pandemic liquidity frenzy levels (and a key difference now is the record pace and magnitude of monetary tightening globally vs easing back then).
Dave Lutz at Jones Trading Twits note that Only 53% of SPX stocks are still trading higher than their 50-day moving averages, which is down from almost 90% just three weeks ago.
4. Before Monday Rally….Energy Returned 10% Over QQQ for Last Month
Everybody wants what feels good. Everyone wants to live a carefree, happy and easy life, to fall in love and have amazing sex and relationships, to look perfect and make money, and be popular and well-respected and admired and a total baller to the point that people part like the Red Sea when you walk into the room.
Everyone would like that—it’s easy to like that.
If I ask you, “What do you want out of life?” and you say something like, “I want to be happy and have a great family and a job I like,” it’s so ubiquitous it doesn’t even mean anything.
A more interesting question—a question that perhaps you’ve never considered before—is what pain do you want in your life? What are you willing to struggle for? Because that seems to be a greater determinant of how our lives turn out.
What pain do you want in your life? What are you willing to struggle for?
Everybody wants to have an amazing job and financial independence—but not everyone wants to suffer through 60-hour work weeks, long commutes, and obnoxious paperwork, to navigate arbitrary corporate hierarchies and the blasé confines of an infinite cubicle hell. People want to be rich without the risk, without the sacrifice, without the delayed gratification necessary to accumulate wealth.1
Everybody wants to have great sex and an awesome relationship—but not everyone is willing to go through the tough conversations, the awkward silences, the hurt feelings, and the emotional psychodrama to get there.
They view pain as an objectively negative thing to be avoided at all costs, whereas reality is much more nuanced. As I cover extensively in my Resilience Course in the Mark Manson Premium Subscription, we are all capable of—and I’d argue responsible for—ascribing meaning to our pain, and this can actually give our life purpose.
But most people don’t realize this. And so they settle. They settle and wonder “What if?” for years and years until the question morphs from “What if?” into “Was that it?” And when the lawyers go home and the alimony check is in the mail they say, “What was that for?” If not for their lowered standards and expectations 20 years prior, then what for?
Happiness requires struggle. The positive is the side effect of handling the negative. You can only avoid negative experiences for so long before they come roaring back to life.2
At the core of all human behavior, our needs are more or less similar. Positive experience is easy to handle. It’s negative experience that we all, by definition, struggle with. Therefore, what we get out of life is not determined by the good feelings we desire, but by what bad feelings we’re willing and able to sustain to get us to those good feelings.
What we get out of life is not determined by the good feelings we desire, but by what bad feelings we’re willing and able to sustain to get us to those good feelings
People want an amazing physique. But you don’t end up with one unless you legitimately appreciate the pain and physical stress that comes with living inside a gym for hour upon hour,3 unless you love calculating and calibrating the food you eat, planning your life out in tiny plate-sized portions.4
People want to start their own business or become financially independent. But you don’t end up a successful entrepreneur unless you find a way to appreciate the risk, the uncertainty, the repeated failures, and work insane hours on something you have no idea whether or not it will be successful.
People want a partner, a spouse. But you don’t end up attracting someone amazing without appreciating the emotional turbulence that comes with weathering rejections, building the sexual tension that never gets released, and staring blankly at a phone that never rings. It’s part of the game of love. You can’t win if you don’t play.
What determines your success isn’t “What do you want to enjoy?” The question is, “What pain do you want to sustain?” The quality of your life is not determined by the quality of your positive experiences, but the quality of your negative experiences. And to get good at dealing with negative experiences is to get good at dealing with life.
To get good at dealing with negative experiences is to get good at dealing with life.
There’s a lot of crappy advice out there that says, “You’ve just got to want it enough!”
Everybody wants something. And everybody wants something enough. They just aren’t aware of what it is they want, or rather, what they want “enough.”
Because if you want the benefits of something in life, you have to also want the costs. If you want the beach body, you have to want the sweat, the soreness, the early mornings, and the hunger pangs. If you want the yacht, you have to also want the late nights, the risky business moves, and the possibility of pissing off one person or ten thousand.
If you find yourself wanting something month after month, year after year, yet nothing happens and you never come any closer to it, then maybe what you actually want is a fantasy, an idealization, an image, a false promise. Maybe what you want isn’t what you want—you just enjoy wanting. Maybe you don’t actually want it at all.
Sometimes I ask people, “How do you choose to suffer?” These people tilt their heads and look at me like I have twelve noses.5
But I ask because that tells me far more about you than your desires and fantasies. Because you have to choose something. You can’t have a pain-free life. It can’t all be roses and unicorns.
And ultimately that’s the hard question that matters. Pleasure is an easy question. And pretty much all of us have similar answers. The more interesting question is the pain.
What is the pain that you want to sustain?
That answer will actually get you somewhere. It’s the question that can change your life. It’s what makes me, me and you, you. It’s what defines and separates us, and ultimately brings us together.
For most of my adolescence and young adulthood, I fantasized about being a musician—a rock star, in particular. Any badass guitar song I heard, I would always close my eyes and envision myself up onstage playing it to the screams of the crowd, people absolutely losing their minds to my sweet finger-noodling.
This fantasy could keep me occupied for hours on end. The fantasizing continued through college, even after I dropped out of music school and stopped playing seriously.
But even then it was never a question of if I’d ever be up playing in front of screaming crowds, but when. I was biding my time before I could invest the proper amount of time and effort into getting out there and making it work. First, I needed to finish school. Then, I needed to make money. Then, I needed to find the time. Then… nothing.
Despite fantasizing about this for over half of my life, the reality never came. And it took me a long time and a lot of negative experiences to finally figure out why: I didn’t actually want it.
I was in love with the result—the image of me onstage, people cheering, me rocking out, pouring my heart into what I’m playing—but I wasn’t in love with the process. And because of that, I failed at it. Repeatedly. Hell, I didn’t even try hard enough to fail at it. I hardly tried at all.
The daily drudgery of practicing, the logistics of finding a group and rehearsing, the pain of finding gigs and actually getting people to show up and give a shit. The broken strings, the blown tube amp, hauling 40 pounds of gear to and from rehearsals with no car.
It’s a mountain of a dream and a mile-high climb to the top. And what took me a long time to discover was that I didn’t like to climb much. I just liked to imagine the top.
Our culture would tell me that I’ve somehow failed myself, that I’m a quitter or a loser. Self-help would say that I either wasn’t courageous enough, determined enough or I didn’t believe in myself enough.6 The entrepreneurial/start-up crowd would tell me that I chickened out on my dream and gave in to my conventional social conditioning.7 I’d be told to do affirmations8 or join a mastermind group or manifest, or something.
But the truth is far less interesting than that: I thought I wanted something, but it turns out I didn’t. End of story.
I wanted the reward and not the struggle. I wanted the result and not the process. I was in love not with the fight, but only the victory.
Who you are is defined by the values you are willing to struggle for. People who enjoy the struggles of a gym are the ones who get in good shape.9 People who enjoy long work weeks and the politics of the corporate ladder are the ones who move up it.10 People who enjoy the stresses and uncertainty of the starving artist life are ultimately the ones who live it and make it.11
This is not a call for willpower or “grit.”12 This is not another admonition of “no pain, no gain.”13
This is the most simple and basic component of life: our struggles determine our successes. So, friend, choose your struggles wisely.
