Growing Evidence That The Upturn Is Upon Us
Germany rejects Eastern Europe bailout - International Herald Tribune
Germany rejects Eastern Europe bailout
Today was a momentous day. Merkel knows that whilst the British banking system is at a leverage of 20 and the USA at 10 hers is at a factor of 50. They'll need everything they've got for their own bailouts. Todays announcement of Eastern Europe being denied a bailout will be panicking the PIGS. Sorry, Ireland, if you were hoping for a Euro-club bailout courtesy of the Germans - look away now and see if you can find the number for the IMF sharpish.
Economic collapse in Emerging Markets is the next crisis in my opinion. The world financial market has not even begun to get close to factoring in the impact of a mass sovereign debt default in Emerging Markets. This is going to be like the default on Govt bonds after the Russian Revolution combined with the Asian Crisis, combined with The Latin American Debt crisis all rolled into one giant mess.
No Brady Bonds this time - the West is a bit busy.
War is inconceivable. The collapse of the Euro isn't.
WWW
Germany rejects Eastern Europe bailout
Today was a momentous day. Merkel knows that whilst the British banking system is at a leverage of 20 and the USA at 10 hers is at a factor of 50. They'll need everything they've got for their own bailouts. Todays announcement of Eastern Europe being denied a bailout will be panicking the PIGS. Sorry, Ireland, if you were hoping for a Euro-club bailout courtesy of the Germans - look away now and see if you can find the number for the IMF sharpish.
Economic collapse in Emerging Markets is the next crisis in my opinion. The world financial market has not even begun to get close to factoring in the impact of a mass sovereign debt default in Emerging Markets. This is going to be like the default on Govt bonds after the Russian Revolution combined with the Asian Crisis, combined with The Latin American Debt crisis all rolled into one giant mess.
No Brady Bonds this time - the West is a bit busy.
War is inconceivable. The collapse of the Euro isn't.
WWW
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Following WWW's point, I was wondering how a crash in the Euro would impact upon anyone with a loan in Euros? I would presume (perhaps wrongly) that the loan would reduce, but surely the bank would have some contingency plan in place for this? I doubt they'd be happy with hundreds of customers suddenly having to pay less every month.
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Following WWW's point, I was wondering how a crash in the Euro would impact upon anyone with a loan in Euros? I would presume (perhaps wrongly) that the loan would reduce, but surely the bank would have some contingency plan in place for this? I doubt they'd be happy with hundreds of customers suddenly having to pay less every month
It matter not what the bank thinks, as they receive the same repayment stream in €uros.
This is how the recession will pan out:
- Company results will be patchy for the remainder of the year
- Full year results 2009 will be bleak (January 2010 announcements onwards)
- Once all the bad news is out, people will pause for thought
- Investment on delayed / essential capital expenditure will start incipiently in Q1 2010
- Company results mid-year will start showing improvement
- Confidence returns late 2010
- High inflation ensues in early 2011 as excess capacity reductions cause large price rises.
- Late 2011, we all forget we were ever here.
Barring any further bad news / corporate disasters, I feel it unlikely to happen quicker, based upon my professional financial judgement. If currency crises / wars follow (which I feel is highly unlikely), add a year or so to the above programme.
Avoid flight training until January 2010.
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Re-heat from where I sit I would take your scenario in a heartbeat.
HSBC raising £12.5bn today... tells you more about where we are going than where we have been... they feel it is going to get sooo bad they will need the extra money.
You need your head examined if you start an ME/IR now....
HSBC raising £12.5bn today... tells you more about where we are going than where we have been... they feel it is going to get sooo bad they will need the extra money.
You need your head examined if you start an ME/IR now....
I'm not sure about the HSBC rights issue. They bought Midland for a song in a previous crash so are they gearing up to go shopping in this one OR are they wisely filling up the fire buckets before the first flames are seen in the windows... Not sure. Think its more the former but then that would be the bullish side of me running riot!
2007 was the year of the ugly Dollar. 2008 of the ugly Pound. 2009 will be the year of the ugly Euro. Sky rocketing unemployment and an inability to export will force them to crash their currency. Which is a good thing. A strong currency is more of an ego trip than a good thing. Its the collapse of Eastern Europe and the Belgian/German/Austrian/Swiss banks that lent to them that is the real show to watch.
As todays appalling stock market falls go to illustrate we are a long way from bottom yet. Woolies and a couple of frock shops are merely the hors d'oeuvre of this crisis. 3.5 million unemployed, 7% GDP contraction, houses down 35% and then we can start talking about finding bottoms. Missus.
My previous advice of entering the wannabe pilot job market in 2011 at the earliest really needs pushing back a year I think.
Next winter is when the airline job losses will really kick in. Do nothing until at least then when the scale can be assessed.
WWW
2007 was the year of the ugly Dollar. 2008 of the ugly Pound. 2009 will be the year of the ugly Euro. Sky rocketing unemployment and an inability to export will force them to crash their currency. Which is a good thing. A strong currency is more of an ego trip than a good thing. Its the collapse of Eastern Europe and the Belgian/German/Austrian/Swiss banks that lent to them that is the real show to watch.
As todays appalling stock market falls go to illustrate we are a long way from bottom yet. Woolies and a couple of frock shops are merely the hors d'oeuvre of this crisis. 3.5 million unemployed, 7% GDP contraction, houses down 35% and then we can start talking about finding bottoms. Missus.
My previous advice of entering the wannabe pilot job market in 2011 at the earliest really needs pushing back a year I think.
Next winter is when the airline job losses will really kick in. Do nothing until at least then when the scale can be assessed.
WWW
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Long term I think all that is happening will be a good thing. Our 'leaders' with snouts on the trough will be given a good kicking, the worship of the moneymen will end (shame we abolished stoning) and maybe people will learn to be content with what they have. I would suggest relatively few people are really happy from the last 20 years that have seen having somewhere to live costing most of their wage and their job security/income squeezed/quality of life reduced etc. Interesting times ahead I think.
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Quote:
Avoid flight training until January 2010.
Nope, i'm going ahead anyway
Avoid flight training until January 2010.
Nope, i'm going ahead anyway
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Ennis Co. Clare Ireland
Unemployed Bankers, Architects and Accountants soon to be flipping burgers:
Bankers applying for jobs in McDonald's | BreakingNews.ie
and i thought www was just an old pessimist!
Unemployed Bankers, Architects and Accountants soon to be flipping burgers:
Bankers applying for jobs in McDonald's | BreakingNews.ie
and i thought www was just an old pessimist!
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The upturn is here!
British Airways first-class and business-class passengers down by 20 per cent
Are we likely to see a bankrupt BA? or will they consolidate and live to fight another day?
British Airways first-class and business-class passengers down by 20 per cent
British Airways’ first-class and business-class passenger numbers fell by 20 per cent last month as the airline admitted that it was spending £2.7 million of cash every day.
Traffic figures for February were hit by continued weakness in demand because of the economic downturn and also by snow at the start of the month. The poor figures came as BA prepared to meet institutional shareholders today amid growing concern about its financial position.
BA has said that it will suffer an operating loss of £150 million in its year to March 31 after a £900 million profit last year. Analysts fear that next year may be even worse, with some predicting losses of more than £400 million.
Keith Williams, BA’s finance director, said last week that the airline was getting through cash at a rate of £2.7 million a day and that cash balances were falling too fast.
Traffic figures for February were hit by continued weakness in demand because of the economic downturn and also by snow at the start of the month. The poor figures came as BA prepared to meet institutional shareholders today amid growing concern about its financial position.
BA has said that it will suffer an operating loss of £150 million in its year to March 31 after a £900 million profit last year. Analysts fear that next year may be even worse, with some predicting losses of more than £400 million.
Keith Williams, BA’s finance director, said last week that the airline was getting through cash at a rate of £2.7 million a day and that cash balances were falling too fast.
No idea.
However, there is no chance that this deep crisis - worse than Sept 11th worse than 1990 - will be any different and several large airline will go bust.
Wannabes, unless willing and able to work for subsistence wages, are screwed.
Screwed.
Screwed.
There may be some jobs for low time people but it will be at McDonalds wage rates.
WWW
However, there is no chance that this deep crisis - worse than Sept 11th worse than 1990 - will be any different and several large airline will go bust.
Wannabes, unless willing and able to work for subsistence wages, are screwed.
Screwed.
Screwed.
There may be some jobs for low time people but it will be at McDonalds wage rates.
WWW
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Perhaps this is the way to raise funds:
Ryanair may charge passengers £1 to use lavatories on flights
Ryanair may charge passengers £1 to use lavatories on flights
Passengers on Ryanair have learnt to live with paying £2.50 for a cup of coffee. Now they may have to get used to paying another pound to relieve themselves of it.
BA's premium pax fell 20% in Feb. Its a disaster out there. For all airline. In every country.
You won't see the impact until the summer trading is over. Winter 09/10 will be carnage. The long talked about consolodation will happen and will be brutal. Many pilots will be unemployed. The army of those willing to work for subsistence wages and airlines willing to employ them will be the differentiating factor this time.
WWW
Its going to be biblical:
You won't see the impact until the summer trading is over. Winter 09/10 will be carnage. The long talked about consolodation will happen and will be brutal. Many pilots will be unemployed. The army of those willing to work for subsistence wages and airlines willing to employ them will be the differentiating factor this time.
WWW
Its going to be biblical:
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BA hints at job losses as revenue falls
BA hints at job losses as revenue falls - Times Online
Who will be the next airline after BA to send pilots to McDonalds?
British Airways has raised the possibility of significant job losses in the coming year and warned that its revenue will fall by 5 per cent.
The airline was updating shareholders on its outlook for the year and hinted that it may have to pay for job losses. The company has already cut the headcount in management by about 500 from 1,400 but these costs have been accounted for.
The airline has so far declined to speculate on whether jobs would also be lost from cabin crew and its operations division. BA is negotiating with trade unions to freeze the pay of its 45,000 staff.
In a statement BA said: "A similar operation result for 2009-10 to that forecast for 2008-09 has been targeted, before any severance costs in 2009-10."
The airline was updating shareholders on its outlook for the year and hinted that it may have to pay for job losses. The company has already cut the headcount in management by about 500 from 1,400 but these costs have been accounted for.
The airline has so far declined to speculate on whether jobs would also be lost from cabin crew and its operations division. BA is negotiating with trade unions to freeze the pay of its 45,000 staff.
In a statement BA said: "A similar operation result for 2009-10 to that forecast for 2008-09 has been targeted, before any severance costs in 2009-10."
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Are we likely to see a bankrupt BA? or will they consolidate and live to fight another day?
757s sold, protect slots at Heathrow (much of the value of the business), take advantage of bmi dying a slow death, and help kill of the unviable US carriers. 2 years is a while until the cash runs out...and at least this is the worst stage of the recession.
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At least this is the worst stage of the recession.
I'm not as confident as you I am afraid. I would propose we will experience further negative agents as a consequence of the economic correction, prior to observing the economy / industry improving.