I’m indebted to my friend Peter Vanderwicken for the following insight from a recent issue of Vanderwicken’s FINANCIAL DIGEST. He notes the almost uncanny jinx that “moving to beautiful new headquarters” seems to cast.
Part of it may just be the extra overhead. I was once a child tycoon, vice president of the then fledgling (now extinct) National Student Marketing Corporation, with offices on the 35th floor of the Time-Life Building in New York’s Rockefeller Center. It cost $15 a square foot back then (that would be $62 a foot in today’s dollars), and I thought it was pretty spectacular.
“Not good enough,” felt our leader, who moved us into the brand new $35-a-foot Bristol Myers building on Park Avenue, across from the Four Seasons, only to see our stock drop from $140 (unadjusted for splits) to $3 a short while later. (He would eventually occupy free office space in a federal prison, but that’s a different story.)
So part of the jinx may be the increased overhead, and perhaps management distraction with the move (picking out the sharpest carpets instead of the sharpest marketing plans). But mainly I think it’s just a good contrarian indicator. This is the sort of move a company makes at the top, not at the bottom.
Peter recalls writing about Levi Strauss for Fortune, back when it was about to move from “a funky old building” to “San Francisco’s glitzy Embarcadero Center.” Bang: bad years followed. Or look at AT&T and IBM, Peter suggests, building “their elegant towers on New York’s Madison Avenue — just as their fortunes peaked.”
Well the point of this, as you may well have surmised, is: guess who’s planning a major glitzy expansion? The New York Stock Exchange.
Could that mean that computerized, human-free trading is really about to swamp the Exchange? Or could it be a somewhat scary symbol for the market itself? (I’d think the former more than the latter.) I don’t know, but I’m not sure I’d pick right now as a great to buy a seat on the New York Stock Exchange.
Quote of the Day
If Patrick Henry thought that taxation without representation was bad, he should see how bad it is with representation.~The Old Farmer's Almanac
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