20 July 2020

1) The international British Airways has announced they are retiring their entire fleet of Boeing 747 jets, a direct result of the Convid-19 crisis. Once one of the biggest airlines using the iconic jumbo jet, the contraction of the airline industry and the likelihood that air travel will not return to its previous size is forcing all airlines to abandon their jumbo jets early. They are going to the more modern fuel efficient Airbus A350 and Boeing 787 in their place. British Airways now has 31 Boeing 747s, about 10% of its total fleet, with an average age of 23 years.

2) What appears to be a massive attempt to embezzle monies from the general public has come to light with the social media Twitter confirming that 130 accounts were targeted in a hack. The accounts of a handful of prominent users were compromised that allowed criminals to gain access to prominent users such as Joe Biden, Barack Obama, Elon Musk, Bill Gates and Kanye West to post solicitations for money. The attackers were able to gain control of accounts then send Tweets from those accounts asking to send money via Bitcoin to commit cryptocurrency fraud. Wire fraud is a federal felony crime, so the FBI immediately began an investigation of who and how the fraud was perpetrated.

3) Delta Airlines is proposing a 15% cut to minimum pay for pilots to avoid furloughs for a year. This would have to come after the first of October when federal aid terms expire. This is in view that a quick recovery in air travel is becoming increasingly remote because of the rise in new coronavirus cases. More than 60,000 airline employees across several carriers have been warned that their jobs are at risk, including more than 2,500 of Delta’s 14,000 pilots. As financial losses pile up, employees are urge to take early retirements, buyouts and other forms of leave in a attempt to slash cost as financial losses pile up. So far, more than 1,700 pilots have signed up for early retirements. This is just another indicator how the air travel business is probably fundamentally changing.

4) Stock market closings for – 17 JUL 20:

Dow 26,671.95 down 62.76
Nasdaq 10,503.19 up 29.36
S&P 500 3,224.73 up 9.16

Year Yield: up at 0.63%

Oil: down at $40.57

16 July 2020

1) Delta Airlines is expecting to spend up to $3.3 billion dollars on buyouts and early retirements in an effort to slash their labor cost. So far, 17,000 employees have signed up to leave the company because there is little in sight for the pandemic’s impact to end soon. The company is prohibited from laying off workers through 30 September under the terms of the $25 billion federal aid package met to support employee payroll. Delta has roughly 91,000 employees so this is a 19% reduction in their work force. The separation packages include cash severance, extended health care benefits and free flights. Other airlines are offering similar packages in an effort to reduce their work force.

2) Heritage Brands, an anchor of outlet malls across American, is closing all of its 162 stores starting next year. PVH Corp, which owns such brand names as Calvin Klein and Tommy Hilfiger, blames the closure on a combination of changing shopping habits of people and the Covid-19 pandemic. This will result in a 12% reduction in jobs or about 450 employees, saving the company $80 million dollars annually. The company had a 43% drop in revenue because of the impact of the coronavirus.

3) There are growing fears of an environmental disaster erupting in the Red Sea on the coast of Yeman. An abandoned oil tanker with 1.1 million barrels of crude oil, is beached on the coast of Yeman, with the potential to explode or rupture causing major environmental and humanitarian damage in the area. UN officials are trying to gain access to the ship to assess the tanker’s condition, conduct any possible urgent repairs and make recommendations for extraction of the oil, but the area is controlled by Houthi rebels. The danger is from sea water entering the ship’s interior causing rust and loss of structural integrity plus the inert gas that prevents the tanks from gathering inflammable gases has leaked out, so there is the threat of an explosion. To start with, an oil spill could result in 126,000 Yemeni fishermen losing their source of income.

4) Stock market closings for – 15 JUL 20:

Dow 26,870.10 up 227.51
Nasdaq 10,550.49 up 61.92
S&P 500 3,226.56 up 29.04

10 Year Yield: up at 0.63%

Oil: up at $41.04