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Mid-Year Picks and Pans From Barron's Roundtable Part II

RE Mario Gabelli:
Correction: 'outlive' (not out live)

Mid-Year Picks and Pans From Barron's Roundtable Part II

RE Marc Faber:
Shorting X and long GLD doesn't make sense. Probably right about X as earnings will not keep pace for various reasons, even without a slowdown in China (which we don't expect to happen anyway). However, following Faber's logic, slower growth will put downward pressure on gold as one of the side effects is lower inflation.

RE Mario Gabelli:
The Gordon couple have been 'too old' for the past seven years and at this rate will out live most of us and still control TR. Just in spite of all the pundits that have been advising them to sell, they will end up leaving it in some sort of charitable trust so that Wall Street doesn't get a piece of the action! (No knowledge, pure conjecture.)

DBD has some good competition and margins are shrinking. Brinkmanship with UTX didn't pan out as they didn't raise the bid. UTX will come back with a lower offer in six months and remind them how YHOO muddled their chances with MSFT! (Just guessing, no knowledge.)

Regarding FCX, copper prices are poised to fly again, wouldn't bet against them.

RE Fred Hickey:
What rebound is he talking about? H1 showed some pretty solid earnings in most sectors. Excluding banks and financial sectors the first half wasn't too shabby even for half the retailers. Materials and construction is up as well and housing stemmed the slide. Energy, metals & mining and manufacturing did very well, thank you. Hickey should pick up a history book and read about 1929 before doing comparisons.

Airlines Will Profit No Matter What

Correction to previous comment:
"As of yesterday, there was still a three month waiting list for most new small jets."
Should read "three years" - not months. Used small jets take about three months to find and refurbish.

Airlines Will Profit No Matter What

Still looking for one true statement of fact in this article!

Oh where to begin...let's try from beginning to end.

1) "The airlines will make profits no matter what happens to the cost of fuel."

Not true. The airlines can raise ticket prices just so much before passengers opt for other means of transportation or other means of communication or other venues for vacation and recreation.

Airlines need to balance price and capacity very carefully. Always have done so and always will. Higher fuel costs make this balancing act impossible for some lower margin airlines. At some point it becomes impossible for ALL airlines.

2) "hundreds of small jets are being grounded and even hundreds of older large jets are being grounded"

From your comments later on in your article, we assume that you are referring to business jets when saying "hundreds of small jets are being grounded". As of yesterday, there was still a three month waiting list for most new small jets. Small jets that were 'grounded' are the ones that are taken out of service as it no longer pays to maintenance them. Not even close to what you are implying.

As for the larger jets that the airlines are 'grounding', all fleets have varying ages of jets. Whenever there is a downturn, it makes sense to ground the older jets first. Likewise, when replacing fleets, the older jets are replaced first and sent to the scrap yard. They are being grounded in order to improve occupancy rates and margins, not because they use more fuel. If the airlines had the passengers to fill them, they wouldn't be grounding them.

3) "Many a company is scrambling to sell its Gulf Stream Jet while it scrambles to get the best deal on commercial flights."

Name ten prospering companies that are doing so! We will make it easier, name only five companies worldwide!

4) "major airlines will spend billions more on fuel without considering that they will only spend these billions because there is demand for high priced tickets"

See item 1 above. This is a new twist for the basic rule, lower prices create more demand, higher prices diminish demand. The twist is "because there is still some demand at higher prices, this proves that cost of goods sold can increase without concern about volume". Mr. Miller, you should write you own economics textbook. According to your logic, who knows - you might even win a Nobel prize! Sheeesh!!!

5) "A day or so ago, Ryan Air (RYAAY) announced surprisingly good results. Other airlines that own fuel efficient planes have announced good results."

Not true. RYAAY is in the same boat as everyone else as they have used up their fuel hedges. As for 'fuel efficient planes', this can only go so far. BTW, who are the 'other airlines'? Did they hedge their fuel costs?

The list goes on. This article is in dire need of a re-write, NO MATTER WHAT!

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United Airlines: Short Interest Goes Sky-High

"The average Utilisation for the rest" - typo, 'utilisation' as in no caps,
also, utilisation = British spelling, utilization = American spelling.

Wall Street Breakfast: Must-Know News

Thomas,
Suggest you read "Backfire": Carly Fiorina's High Stakes Battle for the Soul of Hewlett Packard

See
www.powells.com/biblio...

Also, a few lessons can be learned from other successful proxy fights, three very different types come to mind;
1) Airtran/Midwest Air 2007 (see blogs.law.harvard.edu/...)
2) Diamond Fields International Ltd. (TSX:DFI) 2002
3) Rentrak Corp. (Paul Rosenbaum) 2000

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