IELTS Reading: Passage Reading Part – 3

Hello readers, here we are with another article with a growth of growing reading habit.

In this article picked from the Market Watch, I have not including the answers to the questions presented later on, which I have kept for the freedom of the readers. So, let’s begin.

THE READING PART

When stocks go to the moon, buildings head for the sky.Historically, bull markets in stocks and real estate bubbles, especially in commercial property, go hand in hand. The same irrational exuberance that persuades mediocre stock investors that everything they touch turns to gold also infects developers who leverage themselves to the hilt with cheap money near the peak of a cycle.And the most visible indicator of that is the skyscraper.In the past, the completion of record-high skyscrapers has been the proverbial bell that rings at the top of the market. Right now, massive construction of super-tall residential and commercial towers, especially in Manhattan, may be signaling the bull’s end is nigh.

Peak hubris

The so-called “skyscraper indicator” isn’t perfect. Its timing can be off because of big buildings’ long development times. But it’s a stark symbol of peak hubris.The first skyscrapers were built in the late 19th and early 20th centuries. The 1900s saw the Metropolitan Life Tower and Singer Building rise in Lower Manhattan before the Panic of 1907. The ornate Woolworth Building opened as the world’s tallest building a few years later.It was soon eclipsed by the Chrysler Building, the Art Deco wonder that opened in 1928, followed by 40 Wall Street. The Empire State Building, which began construction before the 1929 stock market crash, finally opened in 1931 during the Great Depression.That was just the antenna on the tip of the skyscraper, however.

“New York built over 25 tall (over 70 meters high) buildings during each of the five years after 1926,” writes Harvard University economist Edward L. Glaeser in a paper on the subject. “In three of those years, New York built over 35 such buildings, a pace of new construction that the city has never repeated.” We’ll get to today’s building boom in a bit.

In 1973, the World Trade Center in Lower Manhattan supplanted the Empire State as the world’s tallest. Within months, the Sears Tower (now called the Willis Tower) in Chicago had seized that crown. The go-go bull market of the 1960s had pushed the Dow Jones Industrial Average DJIA, -0.95% to an all-time high of 1052 that January. The wrenching bear market that followed lasted almost two years and lopped off nearly half the S&P 500’s value.

Asian financial crisis

By the 1990s, the skyscraper boom had moved overseas. The Petronas Towers in Kuala Lumpur, Malaysia, topped out just in time for the 1998 Asian financial crisis. Before that, Glaeser wrote, “real estate troubles preceded the full-blown crisis, and seem to have helped generate anxiety about the health of the financial sectors in [Asian] countries.”BurjKhalifa in Dubai opened at the tail end of the financial crisis. The Mount Everest of skyscrapers, it has 163 stories and rises over 2,700 feet above the ground. Just months before its early 2010 opening, the ruler of Abu Dhabi bailed out financially strapped Dubai and got his name on the building.That brings us to today, when the animal spirits are again running wild. In San Francisco, Salesforce Inc. CRM, -1.42% , the hugely successful software company, has built the tallest skyscraper west of the Mississippi. It opened in 2018, a contrarian foreshadowing of this year’s failure of Silicon Valley unicorn IPOs like Uber UBER, -1.72% and Lyft LYFT, -2.11% and the spectacular collapse of WeWork, whose co-headquarters just happen to be in that same Salesforce Tower.

Meanwhile, in Manhattan, it’s open season on empty skies. According to real estate site Curbed.com, 19 supertall skyscrapers have either been proposed or are under construction in Manhattan and downtown Brooklyn. Currently, there are only eight buildings in all of New York City that are tall enough to qualify as “supertall.”Some of the biggest players are involved, including Brookfield Asset Management BAM, -0.04% Vornado Realty Trust VNO, -0.35% , and privately owned Extell Development and Related Companies, controlled by Stephen Ross, the billionaire owner of the Miami Dolphins.

One of these supertall buildings is part of the massive $25 billion Hudson Yards complex on Manhattan’s West Side — maybe just in time for the next recession.

Several of these new skyscrapers are pencil-thin towers selling multimillion-dollar apartments to the super-rich — including one three-penthouse combo that went for $91 million to a Chinese investor. The area around West 57th Street and Central Park South has been dubbed Billionaires’ Row and includes Central Park Tower, the world’s tallest residential building.

Unsold luxury condos.

But one-fourth of all new luxury condos built in New York since 2013 remain unsold. Uh-oh.It’s a familiar story in real estate — splurge and purge — and although sentiment among stock investors is hardly euphoric, the massive excesses exposed by the latest skyscraper boom are setting up equities for a fall, too, after 10 years of gains and buckets of easy money offered by central banks.This time is not different. Skyscrapers won’t fall to earth, but their values will, taking stock investors with them. The bell is ringing, my friends, and it’s tolling for thee and me.

THE ANALYSIS PART

Vocabularies:

Exuberance
Mediocre
Hilt
Nigh
Ornate
Lopped off
Contrarian
Splurge and purge

Sentence Analysis with writing material gathering:

The same irrational exuberance that persuades mediocre stock investors that everything they touch turns to gold also infects developers who leverage themselves to the hilt with cheap money near the peak of a cycle.
“Skyscraper Indicator”, an indicator as well as stark symbolism of peak hubris;
The go-go bull market of the 1960s had pushed the Dow Jones Industrial Average DJIA, -0.95% to an all-time high of 1052 that January.
The wrenching bear market that followed lasted almost two years and lopped off nearly half the S&P 500’s value.
It opened in 2018, a contrarian foreshadowing of this year’s failure of Silicon Valley unicorn IPOs like Uber UBER, -1.72% and Lyft LYFT, -2.11% and the spectacular collapse of WeWork, whose co-headquarters just happen to be in that same Salesforce Tower.
It’s a familiar story in real estate — splurge and purge — and although sentiment among stock investors is hardly euphoric, the massive excesses exposed by the latest skyscraper boom are setting up equities for a fall, too, after 10 years of gains and buckets of easy money offered by central banks.

Questions to be asked:

What can be a suitable title for the passage above?
According to the passage, what is the relationship between the bull-market and the real-estate bubble?
What sort of indicator can show pure hubris towards stock market?
According to passage, what is the percentage of depletion is stock point of UBER and LYFT comparing CRM?
What information verifies that the current condition of Manhattan skyscrapers being more on the line that required?
How many conventional “super-tall” buildings are in New York City as of recent?
Who happens to be the major players in New York City real estate market; provide a brief picture of their ownership percentages?
What is the common connection between the Miami Dolphins and the real estate market of NY?
As per the passage, what are the contributions of Chinese parties in real estate development in NY?
Where does the tallest residential building in the world belong to?
What is the actual reason for the value of real estate market to fall abruptly?
What can be concluded from the passage in a short sentence?