Recession ? or Depression on Wall St ?

peawack

Just watching the Dow Jones Index falling through the floor and the price of oil going the other way. Got to thinking, which company is most vulnerable ?
Maybe an airline like Singapore, with it's new mega-airliners ?
Any other nominations ? Which ones to avoid above all others ?

tradetime

BA will probably go to the wall before Singapore Airlines, though I know what you mean, investing in airlines would be best approached cautiously.As would anything in the financial sector.

amcluesent

>which company is most vulnerable<

The real question is which country is most vulnerable!

And it's Britain! We're a crock, everything's broken, the money's gone, the oil's gone, we're overrun by fifth-columnists. The conditions for a breakdown in social order are all there; no wonder Labour's been building the apparatus of a Police State to crush populist revolt.

tradetime

amcluesent wrote: »

>which company is most vulnerable<

The real question is which country is most vulnerable!

And it's Britain! We're a crock, everything's broken, the money's gone, the oil's gone, we're overrun by fifth-columnists. The conditions for a breakdown in social order are all there; no wonder Labour's been building the apparatus of a Police State to crush populist revolt.

:rotfl: :beer: As much as I would like to dispute that, I have to say a lot of it rings true even though generally it sounds OTT.

free4440273

1360 on the S&P: if breached, then say hello to 10,000 on the Dow.

purch

Recession ? or Depression on Wall St ?

Both !!! :eek:

meester

peawack wrote: »

Just watching the Dow Jones Index falling through the floor and the price of oil going the other way. Got to thinking, which company is most vulnerable ?
Maybe an airline like Singapore, with it's new mega-airliners ?
Any other nominations ? Which ones to avoid above all others ?

Singapore Airlines makes large annual profits, year after year, and is backed by the Singapore government.

It is also without doubt the world's best airline and can charge more than competitors thanks to its premium product and superior fleet. They also have lower labour costs than Western airlines and fewer labour problems.

I know companies like BA are paying around $80 for oil at the moment, due to hedging, but I guess if things continue the way they are for much longer, then they will start getting a painful shock.

On a route like London Gatwick - Orlando, First Choice flies 767-300s with 258 passengers. There is a fixed refining cost of jet fuel of $0.73/gallon, the cost of the oil is then:

$25 pb $0.60 = $1.33
$50 pb $1.19 = $1.92
$75 pb $1.79 = $2.52
$100 pb $2.38 = $3.11
$125 pb $2.98 = $3.71
$150 pb $3.58 = $4.31
$175 pb $4.17 = $4.90
$200 pb $4.77 = $5.50

If you are burning 1300 gallons per hour, and it takes 9 hours, that is 12,000 gallons.

The cost is then:

@$25 $62 pp e/w
@$50 $89 pp e/w
@$75 $117 pp e/w
@$100 $145 pp e/w
@$125 $173 pp e/w
@$150 $200 pp e/w
@$175 $228 pp e/w
@$200 $255 pp e/w

So at the moment, they are running about $120 (£60) EACH WAY above the costs of 5 years ago.

tradetime

free4440273 wrote: »

1360 on the S&P: if breached, then say hello to 10,000 on the Dow.

It's a buy anywhere close to 1300 and I doubt very much the Dow can get below 11600 this year, I'll be a buyer anywhere near that level.
The S&P cash closed at 1360.68 on Friday, Futures are already below that level, I'd be very interested in your views on why that level is so important, for me 1370 to 1380 were important in the short term, assuming the current move is not reversed on Monday as an over reaction, then 1348 is the next technical level with a chance, failing that 1326 most likely will hold.

Do you trade a lot? Always like an alternative reasoned view to mine, I'm very aware it's easy to get stuck in your own view.

free4440273

tradetime wrote: »

It's a buy anywhere close to 1300 and I doubt very much the Dow can get below 11600 this year, I'll be a buyer anywhere near that level.
The S&P cash closed at 1360.68 on Friday, Futures are already below that level, I'd be very interested in your views on why that level is so important, for me 1370 to 1380 were important in the short term, assuming the current move is not reversed on Monday as an over reaction, then 1348 is the next technical level with a chance, failing that 1326 most likely will hold.

Do you trade a lot? Always like an alternative reasoned view to mine, I'm very aware it's easy to get stuck in your own view.

I'm actually in agreement with you: I still think we will test the March lows I am also heavily short the miners in the ftse index; in fact the ftse seems to have decoupled (worryingly) from the Dow/Dax/ IMO:eek: I do trade a fair bit, yes, mainly via spread-betting. Yourself?:)

tradetime

free4440273 wrote: »

I'm actually in agreement with you: I still think we will test the March lows I am also heavily short the miners in the ftse index; in fact the ftse seems to have decoupled (worryingly) from the Dow/Dax/ IMO:eek: I do trade a fair bit, yes, mainly via spread-betting. Yourself?:)

I mainly trade the US markets, intraday. My long term views are notoriously unreliable FTSE I'd have thought should hold up fairly well due to it's heavy weighting in energy which should outperform. Although I think oil is largely a speculative bubble, the actual oil industry stocks have not run as high so they should be ok if it corrects.
My view on the US is nothing more that the fact that we are in an election year, and typically equities tend to run up in the back end of those years. Of course that could all go out the window if another shoe drops in this credit mess.

free4440273

^if u don't mind me asking: do you know of any free software (either as a download or online) that gives real-time price action on the Dow? thanks