New York developer Mario Procida is also concerned; he's about to open a luxury condominium building overlooking Brooklyn's Grand Army Plaza -- charging an average price of $1.9 million for units. "There has to be kickback in the marketplace across the board," he said.Yes. A kickback. I don't think that word means what he thinks it means, but his meaning's clear. I know I've been telling you to sell for a while now. I think around March, Manhattan home owners will have taken a big enough hit that I'll stop saying that. I was a little demoralized when the banks pushed their fake profits all last year to prop up local real estate, but I'm guessing that's over, and we can refocus on the plan.
Well, I thought the direct tax blow was a little worse. But, still. Bankers and "management consultants" buy the luxury goods and go to the goofy bars. Bankers pay the rent for "actresses." And now I wonder how many "professions" I'm going to end up putting in quotes.
Even before the weekend, the financial-services industry had shed more than 11,000 jobs in New York and 20,000 in London. Lehman has about 25,000 employees, a majority of them in London and New York. Thousands more positions are expected to be cut through the acquisition of Merrill Lynch by Bank of America Corp.
Jobs in financial services tend to be more important for the overall economy. About 5% of New York City's jobs are in financial services, but they account for about a quarter of wages, some $60 billion in 2006, according to the New York Office of the State Comptroller. That same year, personal and corporate taxes paid by the securities industry accounted for about 10% of the city's tax revenue.
The finance industry, much like the automotive industry, still may have more jobs than the economy can support. "Just how many investment bankers does the economy need?" said Thomas Philippon, a finance professor at New York University.That's a great question. And the answer's not none. I'd say about a hundred. One in every ten thousand investment bankers are probably necessary to our economy.
Still, stocks of companies that own Manhattan real estate were hammered. Merrill's biggest landlord in New York, Brookfield Properties Corp., saw its stock plummet 18% to $17.40 Monday as of 4 p.m. New York Stock Exchange composite trading.