Growing Evidence That The Upturn Is Upon Us

[unwiseowl]

things will inevitably pick up again

Will they? In one year? In five years? Never? My guess is five years. Based on the fact that housing market correction has barely begun, that public spending cuts are yet to be implemented and that unemployement is predicted to get much worse. Plus, Mervyn King is not happy about the way government is stoking up the debt. And there are still concerns about the sate of the banks

It doesn't matter what you think of WWW and his attitude - the fact is, he has no axe to grind and clearly, he knows what he's talking about.

[Wee Weasley Welshman]

Artie - I'm not Jesus Christ. I used to be, I used to strive to be balanced, measured, always offer encouragement and be as positive as possible in a complex world.

Scroggs was like that. Loads of Mods have been like that. But it kills you. It is a chore. A millstone that drags you down.

The reason why I'm about the only Mod left standing from the original line up is that I don't filter my views and I no longer maintain an image. I post what I think and plenty hate me for it. But its so much easier internally. More rewarding. More honest.

PPRuNe make you brutal. You start ignoring PM's instead of composing a crafted personal reply. You start culling posts not with a scalpal but with a flame thrower. You stop worrying about people calling you names and just figure that two years from now it'll be someone else calling you different names.

Artie - do you really think PPRuNe could or would want to influence the numbers signing up to OATS? Sure lots of people say they don't read. Then do. And maybe lots don't. And maybe if I shut up more would.

But so what?

This isn't a popularity contest. The website needs fewer not more users.


Its as simple as this.



This is a **** time to start pilot training.



End of sermon.

WWW


PS swearing is a perk.

[Cirrus_Clouds]

Ryanair to order 300 new a/c

As said before, I like to concentrate on the positives rather than the negatives on this forum, I'll leave that to the pro's

So...

Ryanair plan to order 300 a/c by end of this year, true or not, time will tell!

Ryanair to order up to 300 new planes by year-end: O'Leary - Yahoo! News UK


Times will change, you will see, talking about the bad stuff is all too easy, try the positive side.

If you enjoy flying, just fly privately until times change, keeping doing something that keeps you current and happy within yourself. Let time decide if the airlines is a wise move or not.

[Wee Weasley Welshman]

Yeah - I'm not sure about the RYR fleet expansion plan. It could be the ballsiest move since Maverick popped the speedbrake and Jester flew right by. Really - it could. Fortune favours the brave; the time to buy is when there is blood on the streets etc etc.

However, Stelios has blinked and said No. Apply the brakes. Is he cleverer than Michael O Leary. Probably not but maybe. Only time will tell.

History does contain a suprising number of airlines that over expanded into a downturn and bust themselves.

We shall just have to see.


I like talking about the positive side. Last year I had real fears that the worlds banking system might collapse. In the second week of September 2008 it VERY nearly did:

Banking Collapse of 2008: Three weeks that changed the world | Business | The Observer


That's passed now and my bunker must become the hole for my swimming pool. My sniper rifle can be traded in for a shire horse and the gold buried under my begonias can be dug up and returned to the bank.

The rather more mundane and dull reality can now be confronted. Anemic growth, higher taxes and a rather tedious process of sorting out public sector pensions and other massive and massively boring issues.

There will be some jobs out there for Wannabes. Not many. But some.


WWW

[Cirrus_Clouds]

Totally agree. Well at least we're now all on the right footing/path, sorting all this stuff out now.

Shows what a life style everyone lead before (on risk and greed) and the lack of safety nets in place (pre-Sept. 11th comes to mind). A new financial system will at least minimise this crap from happening again and also have a health/alert system in place. I'm sure that once things start to improve, the pension issues etc will be addressed in a reasonable manner and then flying will then become more realistic.

This will be major problem fixed, but what will be the next for the next recession? Is it possible to have a world without recessions with controlled growth and risk?

What we need to ask is what would have happend if this recession was delayed for a few more years = we would have had a bigger punch in the face.

This may stop people for the mean time getting loans, but my advice would be to try to save as much as possible for the future, therefore reducing your risk and size of loan required.

Be patient and let the governments/financial industries sort out the crap, especially as they caused it.

[jbayfan]

I see WWW can't take criticism. Just deletes posts he doesn't agree with. Maybe I should cancel the $225 USD I pay Pprune for my advertisement every month.

You really are on a power trip.

[Wee Weasley Welshman]

I'm really not.


Your deleted post from 21:03 last night was deleted by PPRuNe Towers. You make your living from owning a flying school do you not? If so then perhaps it is understandable that we have differences of opinion.

Unlike the various flying magazines the purchasing of advertising space doesn't dictate the editorial line here.

WWW

[Re-Heat]

Still too much debt in the market and too little new lending.

Consistent with my post of last autumn, and some earlier comments I made last summer, I continue to await year-end results from companies (reporting Feb 2010) before I would call the bottom of this market.

Air travel is a leading indicator of recovery, and cargo / passenger yields are still falling, even if not as rapidly as before.

Ryanair is ordering for the continual Ryanair aircraft trading company that they try to operate. Contrast number of deliveries to Ryanair against number of aircraft operated...they flog them for many times what is paid to Boeing.

[Wee Weasley Welshman]

Either the banks ain't lending or there is no appetite for housing still.



Weak mortgage lending hits UK housing recovery - Times Online

Weak mortgage lending hits UK housing recovery

Hopes of a recovery in Britain's battered housing market were dealt a setback today when new data for May revealed a weaker than expected number of mortgage approvals and the lowest rise in lending on record.

A total 43,414 mortgages were approved in May, just up from 43,191 in April, the Bank of England said. Analysts had expected a figure closer to 46,000.

In a further illustration of the continued fragility of the market net mortgage lending during May rose by just £324 million, a third of the level in April and a tenth of the amount loaned at the same time a year ago. The increase was the weakest since records began in April 1993.

The BoE figures show that around £19 billion was being MEW'd (Mortgage Equity Withdrawal) into the general spending economy by 2007. Turning off a £19bn money tap was always going to cause a recession. Unless and until house price inflation returns we are going to have to live with a new, smaller economy, able to support fewer airliners and fewer pilots.

Shoes yet to drop include defaults on commercial mortgages, a slashing of public sector spending/jobs and, crucially, a return to normal levels of interest rates.

WWW

[dublin_eire]

I have been of the opinion for a while that WWW is quoting articles and spouting off opinions to suit his own egotistical agenda there.

I've yet to see the end of the world as we know it.

Hard times; yes.

What the future has in store? Who knows... But I guarantee WWW won't be able to predict where we go with this one. Not even the best in business saw this recession coming. I'm sure not even WWW saw it coming and if he says he did I'd take that with a pinch of salt.

He makes himself out to be a God on this thread and it seems to be an obsession of his. Let him at it. I've no time for people who float their own boats and certainly have no time for those that suck up in the process...

Over and out...

[2 Whites 2 Reds]

Afternoon All,

Well it's certainly true that no-one knows what the future will hold. I've bashed WWW in the past for spouting doom and gloom but sadly most, not all, but most of said doom and gloom has come true. As I've bumbled on through my training I feel like I've matured and had a rude awakening with regards to the state of the airline industry. With that in mind and having just finished my CPL, I'm taking some time out before starting my IR and would advise others to do the same. It's been an awful 12 months and unfortunately I would have to concur with WWW that things are still remarkably fragile. On the plus side things WILL pick up, we don't know when, but things will definitely start getting better in the not too distant future. Something that does bother me is the number of people I seem to see diving head first into an FIC at a cost upwards of £5k but with no real hope of an instructors job on completion. It seems to be seen as a way out but in reality it could well be just a way of going further in debt. It's a great thing to do if you've got some prospect of even part time work from it but if not then it just seems like yet more money spent needlessly.

2W2R

[hollingworthp]

Delivery of message aside, I cannot dispute WWW's sentiments and I am amazed he has the stamina to keep it up - and I hope he continues to do so even if it saves only a few people from making - IMHO - a poor decision.

I think the party may come to an end soon as we must be approaching a potential sky rocket of training loan defaults which will cause the remaining bank(s) providing funding for pricey integrated courses to withdraw these risky products.

When I started integrated training in August 2007, the signs to the layman seemed relatively positive and this thread and its predecessor were not around. Unfortunately the poo hit the proverbial fan 4 months or so before my course finished and all the courses since then have been churning out with little or no prospect of useful employment. Even the former stalwart of Ryanair has dried up.

So I find it amazing that guys & girls (be they direct from school or career changers) are making what appears to me to be such a shocking decision to start training at the moment for a career where their decision making decisions really could be life or death.

I was incredibly fortunate to be among the last 7 taken on by NetJets and not a day goes by when I don't think about how much this lucky turn of events has saved me from continual sleepless nights worrying about money - and I largely funded my training with savings from my previous employment.

I can definitely identify with ambitious hopefuls wanting to get right on with it - but the necessity for a backup plan by way of a fall back career if/when things don't pan out is stronger than ever.

[Bruce Wayne]

Re: Ryanair to order 300 new a/c

All well and good "wanting" to order 300 aircraft, however, aside from the PR aspect, it has to be taken into context of the orders and option terms.

This doesn't necessarily mean that Ryanair will expand from 200 to 500 aircraft in its fleet.

Without knowing the terms of the options / orders we have no idea over what term these order options will be integrated into the fleet; or if these will be replacing aircraft in the current fleet when maintenance support agreements expire or are due for renewal and current fleet aircraft are returned and shunted down to second and third tier operators, with their aircraft being shunted down to lower tier operators.

Or indeed, what the financial terms negotiated are.

It would be shrew move to negotiate option terms right now when the manufacturers are facing deferred deliveries and reduced orders right now, with options to defer delivery or trade off future positions during the next market upswing is a good move.

However, don't take it that a "want" to place orders for 300 aircraft means it "will" be done and that it means the fleet will "expand" by the amount ordered.

[The Old Fat One]

...crucially, a return to normal levels of interest rates.

WWW much of what you write makes a great deal of sense, but you've commented a couple of time on a return to "normal interest rate levels". Increasingly more and more economists and economic organisations are predicting a slow and protracted climb out of recession. This would tend to suggest low interest rates for a some time yet, similar to Japan's experience over the past two decades.

I'm pretty pessimistic about the immediacy of recovery, but see an extended period of low interest rates as being one of the few silver linings.

If anything is unnatural at the moment, it is the low cost of fuel - and it is quite possible that will rise even within an extended recession.

[Capt Pit Bull]

This is a **** time to start pilot training.

Well, with all due respect to WWW, it's always a **** time to start pilot training.

I rarely post in here, and when I have its usually to recommend people do not attempt to follow this career path. But the fact of the matter is that some people are going to do it anyway. Regardless of the expense, risk, and mediocre career prospects, there will always be people that will give it a go because it's a vocation; there are people that simply must fly.

If you are such an individual, then now is possibly a less **** time than it often is. Forget about who might be hiring in 18 months time; that's always pure conjecture. The only definite is the nature of the training market right now. I don't keep an eye on that side of things anymore, but on past experience downturns usually drive it towards being a buyers market.

Undergoing Pilot training is ultimately an emotional decision. My advice is get off the fence. If you're going to do it, get on with it. If you're not, get serious about some other career and stick with it.

pb

[2 Whites 2 Reds]

The Old FAT One ........
The low interest rate is one of the few saving graces at the moment as you rightly point out. If they were to sharply rise it would be a disaster for households all over the UK.

As for the fuel price.... anyone notice the 3p one hit increase at the pumps week before last? Most of my flying is done around the south coast where there have been several large tankers parked up off the Isle of Wight for weeks waiting for the oil price to rise before coming in to Fawley Refinery. The increase in oil has already started again and I fear it will be the final nail in the coffin for one or two carriers this winter if it continues.

[Bealzebub]

Jbayfan has a very valid point.

He spends $225 a month to advertise on this site. Presumably that is an expense that is calculated to show a profitable return? The point of any advertising is get customers through the door spending their money with you rather than somebody else. It is also a considered investment that hopefully raises the profile of an advertiser within the target audience. I agree that a forum such as this should not simply pander to the wishes of its advertisers in regard to editorial matters. They pay for an advert not for editorial policy. The problem here is that the moderation however infuriating or annoying, should be perceived as balanced and fair. That is by definition the role of moderation or arbitration. Judges, moderators and arbitrators will make decisions that are perceived as unfair to one or other (and sometimes all) parties, from time to time. There is however a problem when the moderator, arbitrator or judge allows the cult of personality to overtake the role itself. I think any comparison to Jesus is perhaps unhelpful in this regard?

The moderator shouldn't normally be the resident opinion driver or expert witness, since that clearly compromises the role. Nothing wrong with being an opinion driver or expert witness, but it corrupts the balance and fairness of that opinion or comment, by hanging the badge of "moderator" on the participant. There is little perception of fairness in an argument when the other party or other parties expert witness is also the presiding judge.

Flying schools, are not fundamentally any different from most other businesses. They survive by profit. That can only happen by keeping customers coming through the door and spending money. It doesn't matter if its a flying school, an estate agent, a stockbroker or a Ferrari dealer. The same fundamentals of business apply. All of these businesses will market and promote their business. Everybody with a TV set and an ounce of wit, knows the economy is in trouble and spending is being strangled by the actual and perceived loss of disposable income, and the rapid and large reduction in the availibility of consumer and business credit. Despite the realities, the businesses will only survive if they can succesfully convince people that now is the right time to invest in flight training, invest in property, buy stocks and shares, and still make those aspirational purchases. They can sell you what you want, not necessarily what you need. It is much harder to to that today than last year, and they will all need to invest a lot of time effort to convince you that your desires should still be fulfilled and satisfied.

The problem flying schools and their customers face, although they naturally seek to mask it, is threefold. Firstly the economy is in rapid decline, and as well as having to work harder to get customers through the door, they also need to work harder to convince those customers that their own "dreams" will be ready to blossom at some convenient point in the future. This is the crystal ball factor, in that it is a prediction, and therefore anybodies guess.

The second problem is new competition. That competition is in the form of the airlines themselves, who have realised a new market in selling those "jobs" that their customers aspire to. A type rating and a few hundred hours of "vital and necessary" experience has become something of a money spinner for those companies that have seen the new business opportunity to sell a role that was previously a major expense. With no shortage of potential customers at this time, that business is expanding. In turn it has weakened wage pressure at the bottom of the existing F/O scales, for experienced and ex-military job seekers coming into the airline pilot market.

The third problem is a regulatory one. Compulsory retirement ages, and certainly in the major Western economies, have been raised significantly in recent years. In some cases by as much as 10 years from age 55 to age 65. Although the laws of natural attrition mean that not all senior pilots would necessarily be able to take advantage of those changes, it has nevertheless had a major impact on the role of retirement in the job market. The decline in the economy, the weakness in the pension market, and the fact that those affected normally enjoy some of the best terms and conditions in the industry means there is a strong uptake of senior pilots (and mainly Captains,) who are working for anything up to 10 years longer than planned. In many cases these pilots will also be enjoying the additional benefits afforded them by the fruits of their existing or historic pension planning. The nett affect is a rapid reduction of turnover at the top, which is also reducing wage pressure at the top and all the way through the pilot labour market.

Airlines have never had a burning desire to recruit 250 hour pilots. Never! That has only ever happened historically in a few isolated examples, where a large national carrier had its own training establishment (BOAC/BEA Hamble,) or in more recent times (CTC/FTE/Oxford etc.)when an airline saw a cost advantage in tying a structured licence training / type rating programme to its own seasonal needs, with the possibility of a permanent job at the end of the probationary period. Historically airlines sought the best and most experienced applicants from career improvers or crossover ex-military pilots. From a cost point of view, if they could have got away with only one expensive pilot in the cockpit, they would have jumped at the chance. They couldn't, but selling the second seat is certainly the next best (if not better) thing.

It might well be that this all changes at some point in the future, and I can certainly see potential causes of such a change, however the idea that an upswing in the general economy will create a raft of real new jobs for 250 hour pilots, who will be paid a good salary rather than expected to pay, is difficult to see. If these seats are not going to be cash generators, then the airlines will do what they have always done and seek the best experienced and qualified pilots to fill them, at whatever rates the spot market then dictates.

In summary, this is a little like the aftermath of an air crash. You can speculate all and as wildly as you like, however look carefully at the evidence and piece together the reality and you will likely come to a more accurate and beneficial reason, answer and conclusion, even if it is something you would rather not have to accept.

[Bruce Wayne]

As for the fuel price.... anyone notice the 3p one hit increase at the pumps week before last? Most of my flying is done around the south coast where there have been several large tankers parked up off the Isle of Wight for weeks waiting for the oil price to rise before coming in to Fawley Refinery. The increase in oil has already started again and I fear it will be the final nail in the coffin for one or two carriers this winter if it continues.

Yes indeed the oil price has been creeping back up.. The situation in Iran is cause for concern over the oil prices. Further, OPEC are looking to cut production to push prices back up.

[TheBeak]

Not even the best in business saw this recession coming

Not true, what a sweeping statement.

You might want to watch this......

YouTube - Michael O'Leary Discusses Ryanair Profits

He clearly predicted it almost to the exact timing, extent and detail.

[Wee Weasley Welshman]

dublin_eire - I did predict a house price crash and a recession and a credit crunch. I spent the latter half of 2007 here arguing with people about it. To quote myself randomly from the period:


http://www.pprune.org/3556805-post87.html

17th Sept 2007

Getting loans for training is going to get a LOT harder and more expensive.

House prices are falling and probably will fall substantially and this removes the source of funding for at least half of all Wannabes (either releasing their own or parents equity).

There may be fewer training in the near future or possibly just more on the Modular path.

However, the real story is the looming recession and it effects on airline hiring. Airlines tend to lead in and out of recessions.

The music *may* be about to stop...

WWW

And

http://www.pprune.org/3703286-post21.html

15th Nov 2007

Parents with large equity pools and solid incomes may gift their children the means to go on any flying training course they wish. But this is only a fraction of the people who self sponsor their training every year.

Many remortgage their own modest properties. Sometimes to 125% of their market value (see Northern Rock's Together mortgage for an example). Many rely on a PDL, CDL, the Any Purpose loan topped off with a consolodation loan (hello - is that OceanFinance/PictureLoans etc) and a few credit cards on 0% interest.

It is the latter group - not the ones with wealthy parents - that are in most immediate trouble when credit dries up and house prices fall even slightly.

This will probably effect Modular just as much as Integrated. Though at a time when airline hiring is shuddering to a marked slowdown you might be considered a bit mad for going Integrated.

Remember, the house price falls and credit crunch are only just beginning. There is a long way to go yet. And at every stage there will be a Flying Training Industry telling you that there has never been a better time to train.

Its what they do.



Good luck,

WWW

So Son, you take what I say with a pinch of salt all you like, but I've called it early and I've called it correctly so far. Might be wrong next time but at least I've got a track record that Anatole Kaletsky and David Brown would kill for.




The Old Fat One - normal post war interest rates would be just above 5%. The bond market is pricing in UK Interest Rates higher than this. With the nation selling billion pound Gilts by the barrel the IR's will have to go up to entice foreign buyers to buy HM Treasuries debt. Public spending down, Interest Rates up, many years of hard slog and the countries finances MIGHT just be back to respectable. Interest Rates at 10% of their normal level was an emergency response to a crisis. It cannot and will not last because if it did Fiat currencies would start to fail. For the sake of forgoing 0.5% interest on paper money I for one would start using Gold and avoid the governments banking system with its taxes and fees..


Capt Pit Bull - thanks for your visit here and your comments. I am aware that its always a gamble and always difficult. But at work out of 6 dispatchers I deal with 2 of them has CPL/IRs. Trained at a well regarded Integrated school one of them was even sponsored by GAPAN. They are filling out loadsheets for Servisair on £16k with £80k's worth of expensive training going rustier by the day. They are both brilliant, personable, intelligent, gifted people with every box ticked. Nothing. Not a hope. No flying job. Anywhere. On anything. Trying all year. I don't want more people to put themselves in that hole. No other agenda.



Bealzebub - welcome back. We haven't had a chat since you got all shirty about planned bankruptcy amongst wannabes wish to train on credit and then dispose of their debts.

You say:

The problem here is that the moderation however infuriating or annoying, should be perceived as balanced and fair. That is by definition the role of moderation or arbitration. Judges, moderators and arbitrators will make decisions that are perceived as unfair to one or other (and sometimes all) parties, from time to time. There is however a problem when the moderator, arbitrator or judge allows the cult of personality to overtake the role itself. I think any comparison to Jesus is perhaps unhelpful in this regard?

Arsebiscuits to that. Frankly. I'm an immoderate moderator and always have been. This forum, unlike the dire dull attempts elsewhere, is lively and full of debate. It even has people who aren't wannabes contributing to it. Which is flipping unique..

I take a strong view in only one aspect of Wannabeism. I talk of the merits of Integrated or Modular for example. I just call the employment market as I see it and I do see it sometimes as **** because sometime it is. This MATTERS. This really really matters to youngster taking enormous debt obligations based on being able to find a proper paying job 18 months down the line. People lose their houses, their partners and their lives based on this decision.

I knew someone who topped themselves in the early 1990's recession because he ended up losing his house and putting his wife and children in a council house. He couldn't get a flying job and the banks bankrupted him.

This is, to coin a phrase, serious ****.

On this forum we have a deep pool of an audience in potentially exactly this situation. All around are glossy adverts, politicians and Vested Interests urging them to plunge in - the waters lovely. It bloody isn't, its full of jelly fish and weeds and its bloody freezing.

If me saying so pisses you off then instead of trying to shut me up then you are perfectly free, for free, to write here and persuade the readership otherwise. Fair?



WWW