New York is back, or is it? Many Wall Street folks have had enough of the astronomical taxes and rising crime rate in New York City and want out. More than 90 financial services firms have opened offices in the Palm Beach area (aka Wall Street South) since the pandemic began. Firms include hedge funds such as Point72, Elliott Management and high-frequency trading firm, Virtu Capital.
Big banks such as Goldman Sachs, Morgan Stanley and J.P. Morgan have long waitlists of people wanting to move to Florida. Goldman has already moved 100 traders and salespeople to the Palm Beach area. Banks are grappling with how to bring back their workforce to Manhattan, now that NYC's infection rate has fallen to some of the lowest levels in the country and 70% of New Yorkers are vaccinated.
Morgan Stanley CEO, James Gorman wants his employees back in the office by Labor Day. Gorman who contracted Covid last year, has been going in the office 4 times a week. “If you can go into a restaurant in New York City, you can come into the office,” he said. He also warned people who have escaped NYC that they won't make NYC salary if they don't live in NYC: "If you want to get paid New York rates, you work in New York. None of this, 'I’m in Colorado and work in New York and am getting paid like I’m sitting in New York City.'" (someone get this man a cold one asap)
Short Squeez Takeaway: Banks need to be careful about how they bring back employees, otherwise they could lose a lot of talent. The "Great Resignation" is underway – many employees are quitting instead of going back into the office and according to surveys 25-40% workers are thinking about quitting their jobs. (Let the resignation games begin)