'Time to Leave NYC': Mamdani's Socialist Shockwave

Far-left socialist and foreign-born Muslim Zohran Mamdani's surprise primary victory over former New York Gov. Andrew Cuomo in the NYC mayoral race has sent shockwaves through the business community. Even more unsettling for pro-business leaders is the realization that a growing segment of voters in the sanctuary city appears completely detached from basic economic math—a symptom of a failed progressive-dominated education system that has glorified socialism while vilifying capitalism.

Earlier this week, Dan Loeb, chief executive of hedge fund Third Point and a major Cuomo backer, put it best: "It's officially hot commie summer." Loeb was referring to Mamdani's victory over Cuomo in the mayoral primary.

"The irony is that socialist policies that lead to hoarding of available housing and stifles investment in new housing leads to high housing costs; other well-intentioned anti-market attempts at wage control, excess regulation, a bloated government bureaucracy and confiscatory taxes cause this," Loeb wrote on X earlier.

Loeb's X post cited a Wall Street Journal article explaining that Mamdani's rise to fame was fueled by young, white, college-educated New Yorkers who are increasingly frustrated by out-of-control living costs in the progressive city.

The CEO of Third Point emphasized: "Doubling down will not solve any of these problems while they may drive out the city's tax base."

Mamdani's appeal among young, woke voters centers on his socialist agenda, including rent freezes, city-owned grocery stores, and free bus rides.

Mamdani's supporters might want to revisit their college gender studies microeconomics textbooks and relearn that rent control suppresses the construction of new apartments by distorting the economic incentives for developers and investors.

Landlords, such as Danny Fishman, CEO of real estate investment firm Gaia Real Estate, told the Wall Street Journal that the Mamdani administration "would be the death penalty for the city."

Fishman said a socialist in NYC City Hall "would be the best thing to happen to Miami and Palm Beach since Covid."

"We've got to do something," said Greg Kraut, chief executive of New York office landlord KPG Funds.

Kraut plans to set up meetings with Adams and the Republican Party to find "another viable path" instead of Mamdani.

"You're going to see a ton of money coming into the race from all levels literally against this one person," said Kraut.

Earlier this week, Goldman's trading desk noted that its NYC Office REITs basket tumbled on the prospect of Mamdani winning. Their analysts said the "big focus is on the back of Mayoral Candidate Zohran Mamdani winning last night. Lot of inbounds on what this potential administration means for NYC exposed REITs, particularly across Office and Apartment REITs with exposure to NYC."

Anti-communist analyst Karlyn Borysenko commented on the NYC situation, suggesting that "maybe we need a little bit of accelerationism... maybe we need a socialist mayor to show the potential reality we're dealing with."

Borysenko warned that people need to wake up—and noted that the Republican Party certainly hasn't yet understood the threat of a socialist takeover of America. In her view, it might take NYC going fully socialist for the rest of the country to finally pay attention.

We suspect Mamdani's shocking win over Cuomo will mobilize pro-business leaders to begin their anti-socialist campaign. RIP NYC.

Kyle Bass to Loeb: