20 August 2020

1) Boeing Aircraft has received its first 737 MAX orders since 2019, from Enter Air, a Polish charter airline that exclusively uses only Boeing airplanes. They have ordered two 737 MAX with an option to order two more. With the option, this would bring its MAX fleet to ten aircraft. Frzegorz Polaniecki, the general director and board member of Enter Air, said he’s convinced the 737 MAX will be the best aircraft in the world for many years to come. This order for two aircraft pales in comparison to Boeing’s July net negative order of 836 aircraft, but it’s a start in the right direction. Cancellation of Boeing aircraft sales have far outpaced new orders this year because of the pandemic. The last six months, Boeing has faced a combination of problems specific to Boeing and the pandemic.

2) The Federal Reserve is lowering their estimate for economic growth over the second half of the year. The Reserve presents its forecast at the central bank’s eight interest rate committee meetings in a year. The reduced forecast is because they expect the rate of recovery in the Gross Domestic Product and the rate for reducing unemployment to be slower than previously expected. Reduction of the unemployment depends on the reopening of businesses, which in turn is depended on the pandemic.

3) According to Bank of America, moving manufacturing out of China could cost U.S. and European companies $1 trillion dollars over five years. Companies in over 80% of global sectors have experienced supply chain disruptions during the pandemic, so many are widening the scope of their reshoring plans. The shift to return manufacturing back to home countries has been spurred on by the Convid-19 crisis. Supporting companies will also benefit with the increase of economic activity by having manufacturing return.

4) Stock market closings for – 19 AUG 20:

Dow 27,692.88 down 85.19
Nasdaq 11,146.46 down 64.38
S&P 500 3,374.85 down 14.93

10 Year Yield: up at 0.68%

Oil: up at $42.79

3 July 2020

1) The aircraft manufacturer Boeing Aircraft is discontinuing production of it’s iconic 747 jumbo jet after a fifty year run. The last 747-8 will be completed in two years. This marks the end of an era of giant airliners with Airbus also discontinuing its A380 production. The number of routes in the world which requires a jumbo jet are few, with airline companies preferring the twin engine aircraft for long range flights. The 747 made its debut in 1970, and went on to rack up 1,571 orders over its production life, a record seconded only by the wide body 777. Boeing has lost 40$ million dollars for each 747 since 2016, with production down to just 6 units a year. The last 747 for passenger service was Air Force One. With air travel curtailed by the Covid-19 crisis, air carriers don’t expect air travel to recover fully until the mid decade, so airlines are culling out aging jetliners and four engine jumbos from their fleets to limit spending.

2) With interest rates near zero, the most used tool for the Feds to stimulate a sagging economy is becoming ineffective in reversing the pandemic induced recession. Therefore, the Feds are considering using quantitative easing or large scale assets purchases. This is where the U.S. central bank buys hundreds of billions of dollars in assets, most of which are U.S. Treasury and mortgage backed securities. By taking bonds (mostly 2 and 10 year Treasuries) off the market it replaces them with cash in the system, meaning there is now more cash available for lending to consumers, businesses and municipalities.

3) The Senate is considering a bill which would punish retailers for refusing cash payments. Retailers have been pushing for electronic payments to reduce the risk of virus contamination from contact of paying cash. The objective of the bill is to prevent disenfranchise of minorities who have limited to no banking access.

4) Stock market closings for – 2 JUL 20:

Dow 25,827.36 up 92.39
Nasdaq 10,207.63 up 53.00
S&P 500 3,130.01 up 14.15

10 Year Yield: down at 0.67%

Oil: up at $40.32

29 January 2020

1) Amazon it pushing hard to establish its Kuiper broadband internet access satellite system. The planned satellite system will have 3,236 satellites in polar orbits to form a mega-constellation system in low earth orbit that will provide broadband internet service for billions of people around the world who are currently being under served. Amazon is pushing the FCC for expeditious granting of application for system. SpaceX and One Web have also started their planned mega-constellation satellite system.

2) North Korea’s economy is largely hidden from the world because it’s one of the most secretive nations. But it’s known the economy is struggling because of its isolationism, where the average worker makes less than $2,000 a year with much of its population undernourished. Citizens are paying as much as $12,000 to defect.

3) Boeing Aircraft has secured over $12 billion dollars to finance its 737 MAX crisis. Loans from over a dozen banks will shore up Boeing’s balance sheet until deliveries of its 737 MAX can resume with resulting revenues coming in. This is at least $2 billion dollars more than Boeing originally sought, making the loans a vote of confidence of its future. The loan is a delayed-draw loan, meaning the company may not use it immediately.

4) Stock market closings for – 28 JAN 20: Markets rebound from threat of coronavirus.

Dow                      28,722.85    up    187.05
Nasdaq                  9,269.68    up     130.37
S&P 500                 3,276.24    up       32.61

10 Year Yield:    up   at    1.64%

Oil:    up   at    $53.98

7 February 2019

1) American trade deficient continues to fall, now down to $49.3 billion dollars. This is a decline of 11.5% from last October’s $55.7 billion dollars. American exports fell, but imports fell even fast to give a net decline of the trade deficient.

2) Daimler has experienced a financial downturn while Toyota’s improved. Daimler’s fourth quarter net profit fell 49% even though revenue is up 7%. Sales are down for their luxury automobiles because of trade wars and bottle necks such as environmental certifications.

3) Boeing Aircraft is being sued for a wildfire that devastated Malibu California. The suit alleges that Boeing was negligent in the management of vegetation which allow the fire to spread. The fire resulted in three deaths, burned 100,000 acres while destroying 1,500 structures.

4) 6 FEB 19   Stock market closings:

Dow               25,390.30     down    21.22
Nasdaq             7,375.28     down    26.80
S&P 500            2,731.61     down      6.09

10 Year Yield:     unchanged    2.70%

Oil:     down   at    $54.00