Growing Evidence That The Upturn Is Upon Us

[DUXBY]

Don't we all love MOL I bet he can't wait to mop up the business from any further collapses.
He says that people are downtrading but if we are to believe his predictions of a drepression his latest boom in business will be short lived. The majority of the market he is pitching to will soon consider a cheap weekend away as a luxury they can do without, if not already.

[ChrisLKKB]

Agreed with everything above re' FR and MOL and...

his latest boom in business will be short lived

IMO He'll be hoovering up the final few pennys before there is a significant drop in air travel and winning a little more brand loyalty on the way. It's going to put them in a better position to weather the recession and to make the most of the up turn when it finally arrives. Yet more good news for wannabees who plan and time the start of their trainning carefully as long as FR continues with it's current trend of recruiting low hour pilots.

(it's also another cheap but effective MOL publicity excercise)

[ChrisLKKB]

The upturn could be some way away...

The report indicated that the squeeze on credit, as banks cut back on the amount they lend in order to repair their balance sheets, could endure until beyond 2010, implying that families will still be feeling the effects of the credit crunch far longer than most currently expect.
It said: "The deleveraging process may continue past the end of the decade. Bank balance sheets are under pressure to expand, as certain types of near-bank entities contract, fold, or are bought, and credit is re-intermediated, and as firms draw down pre-negotiated credit lines."

IMF urges Darling to act fast on credit crisis - Telegraph

[Wee Weasley Welshman]

The pound will be toast as soon as the mass bank nationalisation is announced and IR's begin to be drastically cut.

Foreign holidays and breaks are going to look much more expensive next year. I suspect that God is going to add to the airlines misery by making the summer of 2009 a 4 month heatwave. Things are so bad that I now believe Mother Nature will turn against UK airlines.

There is absolutely no way that several UK airlines will not go bust in the next 12 months. DO NOT expect to be able to get a job for years.

The present crisis was my worst fear and now it is happening it will take a while for the economic damage to become apparent. Japan's Lost Decade will be the closest guide.

EU wide there will easily be 50 airlines cease trading this winter. Wannabes will be in the job market with all those pilots. It will be 1991 with knobs on.


WWW

[Aerospace101]

WWW- are you secretly robert preston, the business editor of the BBC?

Totally agree with you.

Earlier this year I was thinking this was just another blip like 9/11. Upturn, Downturn etc. However this is the MOTHER OF ALL DOWNTURNS. It should be classed in a league of its own. We've only just reached tip of the iceberg. The evidence so far;
- Global market collapse; not seen since 1930s era
- UK economic recession - less people flying on holiday, less business premium pax
- Banking/credit crisis - no cash for airlines
- High Oil Prices (at 9/11 it was something stupid like $15 barrel!!)

The only airline which looks like it will win in this situation if flybe. So flybe will be the only hope for wannabes over the next 5yrs or so. flybe have a regional market which is more resistant to recession. most fuel efficient aircraft for their regional model.

I think Ryanair have bitten of more than they can chew. MOL has admitted theyll lose money this winter - but how much!?! Ryanair pilots are on forced unpaid leave...

Watched Branson on TV today. His reply about Virgin Atlantic was a very hesitant 'OK'. If BA are having it hit hard on premium traffic, good luck to virgin!

XL went bust because it ran out of cash. All the uk airlines (except flybe) MUST be losing money, or barely breaking even now. The question therefore is, which airlines have enough cash to ride out this storm??

I suppose the only good news for wannabes is that flybe are obvously going to continue recruiting, and their new MPL is a great opportunity for wannabes to get a shot at an airline career from abinitio.

And WHEN the upturn comes (which wont be for years and years) it will be the mother of all upturns!! Itll be the days of when all you needed was a driving licence to become a BA sponsored cadet!!

[heli_port]

Further evidence that the upturn is upon us:

Four hundred Ryanair pilots and cabin crew will be forced to take one week of unpaid leave this year as the budget airline cuts back flights from Dublin and Stansted.

Ryanair crews must take unpaid leave, says Michael O'Leary - Times Online

[spinnaker]

Although the current economic phase is not yet fully played out yet (the collapse of the banking system), but does anyone see evidence of deflation? I do.

[ChrisLKKB]

What evidence is that, isn't it a bit early to be calling it? Good for consumers who have cash, not so good for house sellers.

I'm looking forward to a cut in government spending (other than the bail out) as I think they need to be looking to make better use of the money they spend, prune a bit of dead wood out of the NHS and the like etc.

[Wee Weasley Welshman]

The only thing to look forward to is decades of higher taxes and lower growth as a result of this epic public 'spending'.

What will happen is what has to happen. Which is house prices must come down; the banks' assets must be repriced; insolvent banks must be closed; interest rates must encourage saving; consumers will have to stop borrowing to spend and everyone will have to start paying their debts.

Debt deflation is where we are headed rather than hyper inflation.

It will be economically painful but the sun still shines.


WWW


ps I have lot of sympathy for this hilarious view:

BANKS TO LEND YOU YOUR OWN MONEY - The Daily Mash

[Re-Heat]

50 bps rate cuts globally including BoE.

[Wee Weasley Welshman]

So my savings income is dropping then. Great. All sorted.

Japan took their Interest Rates to zero and it didn't help them either.

WWW

[ChrisLKKB]

Originally Posted by WWW

The only thing to look forward to is decades of higher taxes and lower growth as a result of this epic public 'spending'.

do you wander around with a little black rain cloud over your head WWW ?

I'm not overly happy about the points 2 and 3 but on the whole your predictions below for the most part are worth celebrating alone!

Which is house prices must come down; the banks' assets must be repriced; insolvent banks must be closed; interest rates must encourage saving; consumers will have to stop borrowing to spend and everyone will have to start paying their debts.

In short, a return to the real work I think!

[biaeghh]

Chris,

Well said and welcome back to the ratrace,

[Wee Weasley Welshman]

No little black clouds for me. The suns out on my farm, the birds are singing and I'm just back from walking the dog in the beautiful woods and off now to do a quick whiz around Europe.




WWW

[MIKECR]

www,

I bet your that grumpy bu**er that I meet everyday when im down the woods with my 2 dogs ...!!

But 'yes', the sun is shining today, the birds are singing, my mortgage rate has just come down again, my local garage is 25 pence a litre cheaper than 3 months ago....and I've just had positive news on the job front!

[ChrisLKKB]

Chris,

Well said and welcome back to the ratrace,

Thanks biaeghh but to be fair I don't think I ever left it, I think there may be a misunderstanding about the level of pessimism that us grumpies have.

Long term I think we will come through the storm in pretty good shape as long as the government uses its recently purchased position wisely. We still have quite a long way to go though imo (exactly how far I don't no).

WWW is entitled to his own opinion (more than I am in the context of this board) and although I think he makes some good points I tend to go with the slightly more positive view of the senior fund managers and banking cheifs that things aren't quite as bad as some of the extremists would have us believe.

It's probably wise to brace for more shocks in the coming months and keep our fingers crossed that Anthony Boltons prediction is correct and that the (long road) to recovery starts with the banks.

[spinnaker]

ChrisLKKB

I am referring to the massive amounts of money disappearing from global economies, the drop in oil and food prices and lack of credit, the fall in demand and output. I find the reason given by the Bank of England for cutting rates today interesting. It stated that today's cut was to achieve the 2% inflation target. The traditional solution to high inflation is to increase interest rates, but that is not the case. I'm not disagreeing with the cuts, just querying the reason given. Inflation is not, as I see it, the problem, nor did it get us into this mess. Deflation on the other hand could be devastating, with an ever downward spiral. The classic remedy for deflation, although short term, is to cut bank rates, which is what they did today. Maybe I am premature with this call, but I feel that if the bottom isn't reached soon with the financial markets, deflation could be the new enemy during 2009.

[ChrisLKKB]

Originally Posted by spinaker

The classic remedy for deflation, although short term, is to cut bank rates, which is what they did today. Maybe I am premature with this call, but I feel that if the bottom isn't reached soon with the financial markets, deflation could be the new enemy during 2009.

Or print more money (there must be a catch with that though) ?? Interesting RBS and HBOS have climbed a bit (16.00) where as Lloyds and Barclays have slumped, HSBC has remained compartively steady.

I wonder if short term investors drove RBS and HBOS up briefly with the sole intention of making a quick buck?

I hope we find the bottom very soon and you're wrong about 2009.

Originally Posted by topslide

Firstly, this government bank buyout with taxpayers money. It'll be obvious to some but definately not many that the money the government is using to do this will have to be borrowed as the public finances are up the swanny. That means higher taxes.

It may mean higher taxes but loads tax payers were happy to benefit from the boom whilst it was happening buying their over priced houses on 100% mortgages, furnishing them with flat screen tv's, new bathrooms, kitchens and putting brand new mpvs and 4x4 on their block paved drive ways. They reveled in the increased spending power and spent money like it was going out of fashion, now it's time to pay the piper.

[spinnaker]

Originally Posted by ChrisLKKB

Or print more money (there must be a catch with that though) ??

That's how we got into this mess, by creating far too much money from debt, and the debt went bad...etc. Ironically, the cure we are looking for IS more money, but that has to be sourced elsewhere by raiding bank and national reserves, so far that has not been enough, and reserves have been shifted around by cash investors. That's part of the catch.

Originally Posted by ChrisLKKB

Interesting RBS and HBOS have climbed a bit (16.00) where as Lloyds and Barclays have slumped, HSBC has remained compartively steady.

RBS and HBOS stand to gain the most from the UK bailout. But, the rescue plan has punitive strings and is less attractive to LTSB and Barclay, they are not so bad (at the moment) but they still need the money. I reckon they will hang out for a better deal on the Interbank system. I think they will fail and LTSB and Barclay will have to take the government package at some stage. Also remember the rescue plan is against the interests of the shareholder. The only thing that has happened today that is positive, is that a coordinated plan was put into action by European, American and UK central banks. The emphasise is coordinated, the rate cut in itself is of little consequence. If more coordinated action in the future happens, then at least the slump may be brought under control quicker.

[benish]

The government themselves are in debt so its just a vicious circle. If it wasn't for the media peoples confidence in money and investment wouldnt have fallen, there wouldn't be a need for worry either. HBOS wouldn't have gone down until people started taking there savings.

Anyway, I'm not worried about this financial crisis, we have to get on with our lives. Fair enough we may lose a night out once/twice a month because of rising costs but its not too major. Im almost 19 and I'm going to Naples nexzt year to do Multiflights AB Intio, in 2-3 years when ive got a fATPL i have hope it will all be going uphill again.
I work at an airport at the mion and I speak to pilots on a daily basis, all have them say if you want it that badly you just go all in for it, they would go now with no holding back.
A ryanair pilot told me they need 300 new pilots next year and expect a 40% increase in the amount of pilots over the next 3 years, not sure how true that is but its very promising.

Keep the faith.