Those New Yorkers with attention spans long enough to sit through the recent round of televised debates between Republican mayoral candidate Joe Lhota and his Democratic opponent, Bill de Blasio, have been treated to a familiar phrase.
Time and time again, de Blasio has told voters of a “Tale of Two Cities” — the glittering Bloomberg finance-centric utopia and the place where more than 40 percent of all residents live at or near the poverty level.
Surely, New Yorkers can do better to bring up the lowest two-fifths. He is right about that.
But while de Blasio has been bashing the Bloomberg years and Lhota has been backing away from Mayor Mike’s record, this fact has been lost: New York City’s $600 billion economy has been the biggest beneficiary of the Federal Reserve’s money-printing machine over the past four years.
Not only are stocks at record highs, but also city construction is now back above 2007 levels, real-estate prices are soaring, and the unemployment rate is a full percentage point below the average of other major cities.
Meantime, a stronger euro has kept European tourists spending with abandon on Fifth and Madison avenues, and an Internet boom has made technology Gotham’s second- biggest industry.
In other words, in a post-crisis world it doesn’t get much better than New York City today. Based on financial metrics, if New York City were a stock, it would be at or near new highs.
That should scare the dickens out of both candidates for mayor.
If the Janet Yellen Fed begins to wind down its creative money-printing program in mid-2014 as expected, the collateral damage will hit the New York economy first.
Last week several of the city’s top money men sounded the alarms.
Larry Fink, head of the BlackRock investment firm, warned that the markets were starting to look “bubble-like.” Dan Loeb, the man behind Third Point Management, is so bearish he’s returning investors’ money for lack of buying opportunities.
If, as all the pundits predict, de Blasio emerges victorious, these developments should be sobering.
Because for the crucial private-sector finance, media and technology economy he’s been so quick to dismiss, this may be as good as it gets for a while.