Stratovarius Community

Damn... goint to Europe will not get cheaper anytime soon...

The opposite is getting cheaper and cheaper though. I'd like to work in Europe and live in the US at times like this,just for that part.

stratobabius wrote:The opposite is getting cheaper and cheaper though. I'd like to work in Europe and live in the US at times like this,just for that part.

Sure, but pay for the transport! Would leave anyone broke.

it's easier to say, to get paid in euros! hehe

Do you think Euro will continue growing more and more,. creating more diference against USD?

RazielSR wrote:Do you think Euro will continue growing more and more,. creating more diference against USD?

Personally yes... The Dollar has been losing a lot of momentum over the years and the Euro just seems more stable at the moment, and that stability is what many investors crave, hence they buy euros thus increasing its price.

Very nice, but as of today, the Euro still only buys 70 pence on the Pound Sterling. I'd be willing to bet that there's more than a few reasons why our British cousins refused to adopt the Continental currency.

finance.yahoo.com/q?s=EURGBP=X

miditek wrote:Very nice, but as of today, the Euro still only buys 70 pence on the Pound Sterling. I'd be willing to bet that there's more than a few reasons why our British cousins refused to adopt the Continental currency.

finance.yahoo.com/q?s=EURGBP=X

The Euro buys only 58 cents of the Cyprus Pound. Cyprus is still joining the Eurozone however.

NeonVomit wrote:

miditek wrote:Very nice, but as of today, the Euro still only buys 70 pence on the Pound Sterling. I'd be willing to bet that there's more than a few reasons why our British cousins refused to adopt the Continental currency.

finance.yahoo.com/q?s=EURGBP=X

The Euro buys only 58 cents of the Cyprus Pound. Cyprus is still joining the Eurozone however.

That's very good. However, regarding the Euro, there are always unintended economic events that can occur. Let's take the commercial airplane manufacturing industry as one example. The Euro climbs, the dollar declines.

Now let's say that you're sitting at the president's desk at Virgin Atlantic, and Richard Branson had just called to let you know that he's a bit nervous about the margins for the next two fiscal quarters and expects you to make a decision to help out on your end. You're carefully examining two proposals for new jet airliners; one bid is from Airbus and the other is from Boeing. You actually have both types in your fleet, but also notice that Boeing's solution is about $100 millon USD less than Airbus's bid. Both planes are more or less identical, when comparing the same classes of products. Who do you think will get the bid? If you said Boeing, then move to the front of the class.

Well, the problem is because that Euro is strong towards the dollar, the prices in Europa are still growing...That's not a good thing for the consumers who have not a lot of money...

miditek wrote:That's very good. However, regarding the Euro, there are always unintended economic events that can occur. Let's take the commercial airplane manufacturing industry as one example. The Euro climbs, the dollar declines.

Now let's say that you're sitting at the president's desk at Virgin Atlantic, and Richard Branson had just called to let you know that he's a bit nervous about the margins for the next two fiscal quarters and expects you to make a decision to help out on your end. You're carefully examining two proposals for new jet airliners; one bid is from Airbus and the other is from Boeing. You actually have both types in your fleet, but also notice that Boeing's solution is about $100 millon USD less than Airbus's bid. Both planes are more or less identical, when comparing the same classes of products. Who do you think will get the bid? If you said Boeing, then move to the front of the class.

Yes, it's always complicated.. but in some sense the value of the currency also reflects the confidence of investors in the policies of the government.. that the people at the helm say and do stuff that makes sense. (Cf. for instance Greenspan this week or whatever it was.. fairly brutal considering how these 'high priests of economics' people always speak in riddles and metaphors.. didn't read the book but it looks interesting.)

A weak dollar is of course good for US manufacturing companies. Another question is if a huge foreign debt held by the Chinese, a weak dollar and a huge deficit is in the interest of your average John Q. Taxpayer in the US though.. I'm worried about it. An economic collapse (or something like that) on either side of the Atlantic would have consequences for just about everyone on Earth, I think everything really is that interconnected nowadays and transactions are effected very quickly, and in some cases automatically, without any human guidance. So the potential is there for huge "unlinearities" in the economy due to domino effect type of situations. Much like with global warming, but the time scale is milliseconds, hours and days rather than 50-100 years.

How would the world economy handle eg. a giant quake in Tokyo or Los Angeles next week?

(I notice I always post here about smallpox, ebola, carbon dioxide, economic catastrophes... aren't I your regular happy go lucky fellow!!!! )

In the Airbus case maybe something like a government intervention would happen, like the UK government would sweeten the deal with brib.. I mean tax breaks.. or something..

I feel good about Boeing aircraft myself. I like Airbus too, but that's mainly because they are usually so new. If i had to choose, I'd much rather fly on a 40 year old Boeing jet than a 40 year old Airbus.. don't ask me why.. just one of those weird prejudices I have. Kitty Hawk was in the US and no Airbus systems ever made it to the moon... yet anyway

miditek wrote:I'd be willing to bet that there's more than a few reasons why our British cousins refused to adopt the Continental currency.

finance.yahoo.com/q?s=EURGBP=X

That's another can of worm food entirely, I think the main reason is psychological, like in Sweden and Denmark.. I think the UK:ians are more suspicious of the French than the Germans are, and more suspicious of the Germans than the French are ... and that's something!!

All the neighboring currencies of the Euro tend to correlate fairly well with the Euro relative to the USD anyway..

eur/usd/ukp

(marketwatch's Euro is the reciprocal of yahoo's.. and they still calls it GBP even though the ISO code is UKP.. shrug)

If you change the comparison currency to either NOK, SEK, DKK or CHF it looks pretty much the same. They are sort of in the same basket, maybe it is because there is so much trade within europe... who the hell knows. I like it anyway since I make a lot of money in the euro zone currently.. i don't mind it being worth more on the rest of the planet

JensJohansson wrote: In the Airbus case maybe something like a government intervention would happen, like the UK government would sweeten the deal with brib.. I mean tax breaks.. or something..

I feel good about Boeing aircraft myself. I like Airbus too, but that's mainly because they are usually so new. If i had to choose, I'd much rather fly on a 40 year old Boeing jet than a 40 year old Airbus.. don't ask me why.. just one of those weird prejudices I have. Kitty Hawk was in the US and no Airbus systems ever made it to the moon... yet anyway

Airbus hasn't been around for 40 years yet The company was formed in 1970.

Many airlines recieve benefits for getting Airbus aircraft in Europe. They help support the industry and employment. Now if that's fair or not is a different matter.

No Airbus products have made it to the moon, but Airbus has been around for around half as long as Boeing. However, Boeing get many of their innovations from their military department, where there is more money and incentive to be wildly creative.

I like both makes. It's a healthy competition and the constant vying with each other makes for better products, with great innovations from both. I feel equally comfortable on an A330 or a 767.

JensJohansson wrote:Yes, it's always complicated.. but in some sense the value of the currency also reflects the confidence of investors in the policies of the government.. that the people at the helm say and do stuff that makes sense. (Cf. for instance Greenspan this week or whatever it was.. fairly brutal considering how these 'high priests of economics' people always speak in riddles and metaphors.. didn't read the book but it looks interesting.)

Very complicated, so much so that most large multi-national corporations have to use ERP (Enterprise Resource Planning) software such as J.D. Edwards, Peoplesoft, or Germany's SAP just to keep track of everything that is going on in the company. Keeping ERP systems running, updated, etc. is such a nightmare that it almost defies description!

I also noticed the Greenspan stuff last week, and would like to check out his new book. I was once reading an article about the "Greenspan Factor" on Wall Street. It seems that at one time, Greenspan couldn't even go to the bathroom to take a shit without someone trying to analyze what it all meant!

JensJohansson wrote:A weak dollar is of course good for US manufacturing companies. Another question is if a huge foreign debt held by the Chinese, a weak dollar and a huge deficit is in the interest of your average John Q. Taxpayer in the US though..

The US, of course, has lots of other governments investing in long-term treasury bonds, in addition to a slew of other products. And I think that your concern is certainly not unfounded. Unfortunately, Congress is under the impression that they are all horses at the trough waiting to gorge themselves on pork projects, and other associated waste, in order to maintain their power base. Take a look at President Johnson's "War on Poverty" and "Great Society" projects- which to date have had nearly a trillion dollars poured into them, and what has come of it? What return did U.S. taxpayers get for their investment? More crime, more illegitimate kids, more illiteracy, and an accelerated breakdown of the family in the inner-city.

JensJohansson wrote:I'm worried about it. An economic collapse (or something like that) on either side of the Atlantic would have consequences for just about everyone on Earth, I think everything really is that interconnected nowadays and transactions are effected very quickly, and in some cases automatically, without any human guidance.

Yes, due to rapid advancements in technology, particularly in the banking, insurance, and finance sectors, everything has indeed become unbelievably intertwined. Americans should not cackle at bumps in the European makets any more than Europeans should giggle at U.S. financial misfortunes. As you implied, for better or worse, we're all in this thing together.

JensJohansson wrote:So the potential is there for huge "unlinearities" in the economy due to domino effect type of situations. Much like with global warming, but the time scale is milliseconds, hours and days rather than 50-100 years.

Yes, with the recent housing and mortgage debacles that we had recently seen here in the States, it is important to look at the domino and ripple effects. A lot of residential contractors were kind of stupid about this entire thing. In Atlanta and Chattanooga, for instance, we kept seeing row after row of these fucking "McMansions" going up, and all the while, I kept wondering, "who the hell can afford housing like this?"

I mean, you'll always have wealthy people in any city, but even they are not the types that will buy a McMansion. They will go for something even higher end than that. I hate to sound like an economist, but what kind of nitwit loan officer at the bank thinks that a middle class family that makes about $90k-$100k per year will even be able to afford a house that costs $600,000 and up? Now, the builders get stuck with a bunch of houses that they cannot move, (despite their dreams of 35%-40% margins on the higher end houses, as opposed to lower margins on houses that are in the $150k-$250k range that will move), and then the banks get stuck with builders that cannot pay the notes on the houses that did not move. Enter the U.S. taxpayer to bail both of them out.

JensJohansson wrote:How would the world economy handle eg. a giant quake in Tokyo or Los Angeles next week?

Bad news travels fast- particularly in the information age, I'm afraid.

JensJohansson wrote:(I notice I always post here about smallpox, ebola, carbon dioxide, economic catastrophes... aren't I your regular happy go lucky fellow!!!! )

JensJohansson wrote:In the Airbus case maybe something like a government intervention would happen, like the UK government would sweeten the deal with brib.. I mean tax breaks.. or something..

Governments do that all the time, don't they? Dell demanded (and recieved!) over $200 million in tax breaks from the state of Tennessee in exchange for building a new manufacturing and distribution center in the Nashville area not too long ago.

JensJohansson wrote:I feel good about Boeing aircraft myself. I like Airbus too, but that's mainly because they are usually so new. If i had to choose, I'd much rather fly on a 40 year old Boeing jet than a 40 year old Airbus.. don't ask me why.. just one of those weird prejudices I have. Kitty Hawk was in the US and no Airbus systems ever made it to the moon... yet anyway

I hate flying. I'm sort of like Mr. T. from the A-Team T.V. series- please break out the valium just prior to boarding, and wake me up when we get there.

All this is a sign of how inter-dependant the world economy has become. It's almost impossible for a major disaster in one large market not to affect all the others.

Is this a good thing or a bad thing?

JensJohansson wrote: In the Airbus case maybe something like a government intervention would happen, like the UK government would sweeten the deal with brib.. I mean tax breaks.. or something..

Just saw this... it's strange that the national carrier, British Airways uses a surprisingly small amount of Airbus products - all their long-range aircraft are Boeing 747, 767 and 777's.

Oh and miditek, safety has far more to do with the airline itself than the aircraft you're flying on. You see WWII aircraft still flying today purely because they've been taken care of. If an airline cuts corners on safety, any aircraft will become unsafe. They're very high-maintainance.

Plus, most major air disasters are caused by the old favourite, human error - either pilot or on the ground. The recent tragedy in Sao Paolo for example had nothing to do with the A320 itself. It was quite new and well-maintained. The runway was deemed unsafe and a judge actually ordered it to be closed to large aircraft, the ruling was however overturned. 2 weeks later, disaster struck, and guess what the cause was... poor drainage on the runway, causing the aircraft to skid out of control on landing. Exactly what the judge had cited as grounds for closure of that runway.

It was just waiting to happen, and now the costs are still being counted.

NeonVomit wrote:Oh and miditek, safety has far more to do with the airline itself than the aircraft you're flying on. You see WWII aircraft still flying today purely because they've been taken care of. If an airline cuts corners on safety, any aircraft will become unsafe. They're very high-maintainance.

Understood- I wasn't exactly looking at the safety aspects, I guess, however, what I was looking at was the overall financial picture since some of the deals are huge. In the US, when you look at aircraft maintenance, you move down the hall away from finance to the HR department, which in turn, gets to deal with the unions, in many cases. And that's where the fun really begins.

I was more or less looking at how currency exchange rates affect can manufacturing costs. Airplanes are essentially capital expenditures (which become fixed assets) where the maintenance is more of an operations issue. It's still overhead, but listed in the labor columns on the general ledger.