TFN eNews 12/15/2009: The next mega-building boom — and who will be profiting from it
Published via e-mail broadcast on December 15, 2009
In today’s TFN eNews:
* The cyclical nature of blame
* Good news for the airline industry
* The next crude?
Dear TFN eNews reader,
Is there anyone still doubting the cyclical nature of business and politics? Well, look no further than President Obama for proof.
It’s rarely mentioned these days that the illustrious leader of the free world, in his less illustrious ACORN days, helped sue Citibank for not making enough shaky mortgage loans.
That was in July, 1994. The crowds oooh’d and aaah’d.
14 years later, he rode into the White House accusing banks of making too many shaky loans. The crowds went wild.
And only a year later — yesterday, to be specific — he again took banks to task. For not making enough shaky loans.
Fancy that.
I know the attention span of the American public — and electorate! — is short. But these changes of position are enough to cause whiplash in anyone whose memory goes past last night’s CSI Miami episode.
President Barack Obama told top”fat-cat” bankers Monday to explore “every responsible way” and “creative ways” to free up lending.
I don’t know about you. But the last time bankers got creative monetizing their social engineering mandate of putting people in houses they couldn’t afford to pay off, we got Credit Default Swaps.
Of course, the saving grace would be that, no matter the outcome, we can always blame bankers for lending too much… or too little.
*** It was a pivotal day for the airline industry. With its latest earnings figures due out after the closing bell, that may not be good news for AAR Corp. (NYSE:AIR).
TFN’s Andrew Snyder writes: “When I married my wife, I should have hired a personal travel agent. With family in North Dakota, Idaho, Washington and Alaska, she has a constant eye on airline prices. The second a deal hits the wires, she knows about.
“With the holidays upon us, she’s found some great deals. Good news for us and our family. But bad news for the airline industry: Lower fares mean lower margins and, in this economy, even larger losses.
“The airline industry is buzzing today, not so much because Boeing (NYSE:BA) is expected to finally get more than the front tires off the ground of its 787, but because the International Air Transport Association (IATA) announced airlines will lose some $11 billion this year and another $5.6 billion in 2010. The pessimistic outlook is significantly below previous estimates, driving down share prices across the industry…”
Read on here, will you… http://www.todaysfinancialnews.com/us-stocks-and-markets/whats-under-the-hood-of-aar-10549.html
*** There are strange things happening in lumber. Weyerhaeuser Company (NYSE:WY), one of the largest U.S. forest products companies, with operations in 10 countries, today announced it would convert into a real estate investment trust (REIT) and pay a special dividend.
Shares soared more than 10 percent in early trading, relinquishing most of those gains later in the day.
The prime motivator for this is to slash the company’s tax burden and provide higher higher returns for shareholders: 90% of profits would be passed on to shareholders.
This might end up being a hugely profitable venture. Because for 2010, we foresee a substantial increase in lumber prices… based almost exclusively on Chinese demand. In fact, I go as far as calling lumber “The Next Crude”.
Let me tell you why… http://www.todaysfinancialnews.com/HSC/timber/EHSCKC13.html
***Widely unnoticed, this change in local building codes is about to send demand for this recession-starved commodity flying.
3 undervalued stocks could generate gains of 200% or even 300%… for early investors with guts and foresight! Learn more here…
http://www.todaysfinancialnews.com/HSC/timber/EHSCKC15.html
*** Quote of the Day:
“When the George W. Bush economy was humming for almost eight years, Obama and his media friends gave Bush no credit because, they said, we were experiencing ‘jobless growth’. These partisan charlatans characterized 4.5 percent unemployment as ‘joblessness.’ What does that make 10 percent — especially in light of Obama’s promise to keep it less than 8 percent?” — David Limbaugh, Creators.com
Recommended Reading:
Obama to the fools: Duct tape will fix it
Today’s Top 3 Financial News Stories:
MoneyNews.com – Thiel: Gold Is The Anti-Investment “He advises investors to ‘think of gold as not a protection against inflation, but as an anti-investment. You invest in gold when there’s nothing good to invest in.’”
NPR.org — Wholesale Price Spike Raises Inflation Worries “Inflation at the wholesale level surged in November, reflecting price jumps in energy and other products. The bigger-than-expected 1.8 percent increase in the Producer Price Index is certain to raise the attention of Federal Reserve policymakers beginning a two-day meeting on interest rates.”
Bloomberg.com — China Faces Difficulties in Maintaining Demand Growth “China, the world’s third-largest economy, faces ‘increased difficulties’ in maintaining growth in domestic consumption, the nation’s top economic planning agency said.”
Cordially yours,
J. Christoph Amberger
Executive Publisher, TodaysFinancialNews.com
Next Article: TFN eNews 12/14/2009: Will there be a buyout wave in the oil industry?
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