Friday, January 31, 2025

Can The UK Limit Heathrow's Climate Impact -- January 31, 2025

Can the UK limit Heathrow’s climate impact? Link here.

By Olivia Rudgard and Hayley Warren

British Chancellor Rachel Reeves has brushed aside concerns about the climate impact of expanding London’s Heathrow airport, insisting there is “no trade off” between the pursuit of economic growth and the UK’s desire to decarbonize. 

Reeves said this week the government will approve the controversial project to build a third runway at the UK’s largest airport, despite concerns that a jump in air traffic would imperil the country’s drive towards net zero emissions by mid-century. 

The mathematics of Reeves’ assertion rely on a big gamble: that emissions reduction technologies will develop fast enough to offset the rise in flights. But, experts say, those technologies are currently expensive, and are yet to prove themselves at scale. 

The UK has a legally-binding target of reaching net-zero emissions by 2050. More urgently, the UK needs to slash its emissions by 81%, compared with 1990 levels, in the next 10 years to meet new climate targets submitted to the United Nations. Air travel currently contributes about 7% of UK emissions.

In 2022, under the previous government, the UK published its “Jet Zero” strategy, which promised “guilt-free flying,” powered by hydrogen, battery-operated planes, and sustainable aviation fuels (SAF). Neither hydrogen nor battery-powered aircraft are anywhere near ready for mass commercialization. That means that for at least the next decade, the burden will fall on SAF.

SAF is a broad definition, including fuels from used cooking oil, synthetic fuels made using hydrogen and carbon dioxide, or biofuels made from plants and trees. Calculating exactly how much it cuts carbon emissions over its lifecycle compared to fossil-based jet fuel is difficult, and depends on the type of SAF used. For example, using fuels from waste in some cases results in barely any emissions savings at all. The UK government’s strategy assumes that replacing jet fuel with SAF results in a 70% reduction in lifecycle emissions.

The UK has mandated that by 2030, airlines must replace 10% of their aviation fuel with SAF, rising to 22% by 2040. 

Chris Hilson, director of the Centre for Climate and Justice at the University of Reading, calls the UK’s projections for SAFs “overly optimistic,” because the fuel is expensive and hard to produce at scale. “Even with these fuels, flights will still produce significant emissions,” he said.

A UK government spokesperson said it was “committed to delivering greener aviation.” They added: “We are already making great strides in the path to greener aviation, with new targets for sustainable aviation fuel starting this year.”

Heathrow declined to comment.

SAF currently costs at least twice as much as jet fuel. The UK government’s own cost-benefit analysis suggests that to hit its SAF targets would cost the industry around £11.4 billion between now and 2040, although some of these costs would be mitigated by the reduced amount airlines would have to pay in carbon credits.

But that assumes there’s enough SAF to meet the quota. Around the world, manufacturers have struggled to get off the ground. Clean energy researcher BloombergNEF estimates that by 2030 there’ll be enough capacity to meet about 5% of global jet fuel demand. Countries, including Brazil, Japan, South Korea and Indonesia are also planning to introduce SAF mandates, which would put further pressure on supply.

Growing emissions from aviation would put pressure on the other pillars of the UK’s net zero strategy. The government is aiming for 100% “clean” power — mostly from renewable sources — by 2030. One analysis, from Alex Chapman at the New Economics Foundation think tank, projects that expansions at Heathrow, Gatwick and Luton would cancel out the carbon benefits of the clean power plan within five years of the expansion taking place. The runway isn’t expected to be built and operational until 2035.

Even in its most optimistic scenarios, UK aviation is already expected to create a surfeit of around 19 million metric tons of greenhouse gases in 2050, which the government expects to cancel out using carbon removal technologies, such as direct air capture — another technology that doesn’t, as yet, exist at scale.

“You are growing something that doesn’t have the option of being decarbonized right now,” said Alice Larkin, a professor of climate science and energy policy at the University of Manchester.

 

Apple -- January 31, 2025

January 31, 2025

Earnings, link here:

Bonehead move of the year: Warren Buffett selling off half of his Apple holdings. Link here. Story won't get any mainstream press.


Products vs services
: link here.

Geiger Capital: doesn't get it. Looking at the past, not the future.

Apple, Tesla, Nvidia: one could have retired three times since 2010. Link here.

The Apple difference: Steve Jobs.

Reuter's: AAPL will do just fine. Link here.

App Economy Insights: link here.

Fun fact: Apple / AAPL made $16,000,000 every second for three months straight. Link here.

Gene Munster: link here.

Apple / AAPL shorts. LOL. Link here.

Wednesday, January 29, 2025

Aircraft Mishap Over Ronald Reagan National Airport -- January 29, 2025

January 30, 2025, sixteen hours after the incident: again, it's interesting that not only has the US Army not released the bios of the three members on the helicopter, American journalists in the mainstream press have not asked the question. Especially in light of New Orleans and Las Vegas.

Later: do you remember the frozen O-ring and the Challenger shuttle disaster? Richard Feynman had it figured out almost immediately. Is President Trump the "Feynman" of 2025? Link here.

Breaking: American Airlines a/c from Wichita, Kansas, and a local helicopter hit each other inflight; the AA plane landed in the Potomac River. Audio.

Sixty personnel on the American Airlines flight; Blackhawk helicopter.  Flight #5342 from Wichita. Three service members on the helicopter. 70 seats on the PSA aircraft operating for American Airlines; all seats not necessarily filled.  There were four crew members on the fixed wing a/c. It is being reported that 64 people were on the PSA a/c, or apparently 60 passengers. Flight #5342 was scheduled to land at about 9:00 p.m. local time. ]

Video suggests the helicopter flew directly into the fixed wing a/c from behind -- the helicopter appears to be overtaking the PSA a/c. The fixed wing a/c is under ATC control; the helicopter is not; the helicopter is responsible for maintaining separation based on visual rules. The helicopter is required to stay below 200 feet. It appears the impact occurred at 150- 200 feet above ground level, according to an NBC journalist reporting.

The plane is in seven feet of water: seven feet of water which suggests the entire fuselage must be above water if intact to any extent. I won't put it in print but there's exactly one thing in which I'm most interested. We won't get that information until tomorrow at the earliest. I would assume the ATC personnel at this airport are the best ATC personnel in the world. Now it's being reported that the helicopter was coming in from behind the fixed wing aircraft.

Senior NBC correspondent says the focus will be on ATC, radio frequencies, etc.

An event like this has not occurred in 35 years in the US. Occurs on Trump's ninth day as president. There are a gazillion airports across the US, any number of which where this could have happened. It happens over Ronald Reagan National Airport in Washington, DC. The most recent "terrorist" events (New Orleans; Las Vegas) that have recently occurred in the US involved two US Army veterans with very similar histories. Link here. If I can think of this, I assume officials can think of this. Conflicting story and flight path: video suggested helicopter hit fixed wing a/c from the side; NBC, others reported from behind; flight paths below suggest from the side.

Map: link here. Eerie.

Other screenshots:

Thursday, January 23, 2025

Ford -- January 23, 2025

Link here.

Zacks: sell. A Zacks four (4).

Shares of Ford F have plunged 26.6% in six months, underperforming the industry, auto sector and close peers, including General Motors GM and Tesla TSLA. Although the automaker's overall fourth-quarter 2024 sales grew 9% year over year, contributing to a full-year increase of 4% year over year, its Model e unit, which has been incurring losses, poses significant growth challenges. Let’s analyze the company’s prospects to figure out if it is the right time to buy, sell or hold the stock.

Wednesday, January 22, 2025

Trump -- Day #2 -- The Anti-Trump Folks Appear To Have Only One Talking Point -- January 27, 2025

The one talking point: Trump's "J-6" pardons. 

On this one issue Trump has the upper hand. Those complaining about his "J-6" pardons without putting the entire picture in context are hypocrites. 

But most interesting: that's all Trump-haters have right now -- his pardons of the "J-6." We're hearing nothing on this from the Capital Hill Dems because they know it's a non-starter with the American public. 

Meanwhile, Trump continues to sign executive order after executive order.

Tuesday, January 21, 2025

Stargate, Oracle, Texas, TKI, Border Command, Immigration, And All That Jazz -- January 21, 2025

 

Updates

January 21, 2025: the second story --  Stargate. Link here. Whenever I see the word "Star" in something "big," I immediately think "Musk." One can begin to connect the dots. Link here.

January 21, 2025: the first story -- TKI.  Link here.

TKI: a new international airport in DFW area? 

  • Texas McKinney National airport --> TexasMcKinneyInternational? 
    • could begin operations as early as 2026 but requires a lot of infrastructure -- highways, roadways, parking lots, terminals, regulatory clearances
  • Compare:
    • DC area has three airports: Ronald Reagan, Dulles, Baltimore-Washington
    • NYC area: JFK, LaGuardia, and Newark Liberty
    • Chicago area: O'Hare, Midway, and Chicago-Rockford
    • Los Angeles: TNTC
  • Texas will become nation's focal point for border security, immigration control.

Original Post

Posted on the day of Trump's second inauguration, January 21, 2025: Border Command.

Military

I imagine Trump's people are having a "come to Jesus" meeting with the Pentagon generals starting tomorrow.

He will probably ask for three options for a number of scenarios, including what to do if Hamas does not live up to his expectations; and, how the military can manage the southern surge and protect the US borders.

This is not a political statement or a statement made by politicos in Congress. This is directly from the Pentagon and follows directly from the US Constitution.


If the Northern Command does not have the resources to do what Trump wants, the Pentagon will have to move resources from other commands to Northern Command.

If folks recall, Trump set up Space Command during his last term. It wouldn't surprise me a bit if he sets up "Border Command" to make it clear he's serious.

The generals will have to provide three options for the president to consider. Their careers will depend on how they perform. There are a lot of three-star flag officers eager get their fourth star. There are 163 three-star flag officers who would like to become one of the 43 four-star flag officers.

Manpower? Could begin by transferring billets from TSA to "Border Command." TSA, at airports, would be manned by uniformed military.  If "Border Command Headquarters" is sited in Austin, TX, or San Antonio, or even better, El Paso, Texas (think Beto), can one imagine the amount of money that would flow to Texas? Posted January 20, 2025.

 

Friday, January 17, 2025

Debt Limit -- January 17, 2025

Debt limit: last full business day of the Trump administration, and Biden's SecTreasury informs the press that using extraordinary measures, "she" can keep the government operating through the inauguration, but then sometime between January 21, 2025, and January 23, 2025, the US will hit the statutory debt limit.

  • this will be a great time to shut down the government, let the incoming administration take a deep breath and start solving the problem in an orderly manner;
  • Trump has dealt with bankruptcy before in his own businesses, so he understands how to manage such temporary problems -- gives him an opportunity to work with creditor to "change" the terms; see box below;
  • if money quits flowing to California and North Carolina, I'm sure the "government" will find ways to come up with the necessary funds
  • it will be interesting what DOGE proposes
    • example: just as American households do, don't shut down the government but prioritize the bills that are going to be paid; and, how much each creditor will be paid;
    • example: suspend all interest payments on government bonds, Treasuries until temporary probably resolved; when payments resume, to include interest;
    • example: freeze all US foreign aid money currently sitting in any stateside (US) bank accounts;
    • example: limit all monthly social security checks to $2,000 (the assumption being that the "rich" get higher SS checks and the poor (those really needing that SS income) are getting smaller checks; the rich won't notice the cut;
    • another example: limit all military pay checks to a max of $4,000 / month 
    • another example: limit all federal pay to a max of $4,000 / month 
    • another example: Medicare: deny all elective surgery; all routine / preventive health visits 
    • another example: huge tariffs on Chinese, Canadian, and Mexican products effective immediately
    • another example: stop all payments to foreign countries effective immediately pending resolution of a temporary problem
    • of course, all the parks will be closed (LOL)
    • all social security payments, military pay, etc., that was capped will be paid in full with interest once the temporary probably is resolved
  • this will make it #79 -- the 79th time Congress will have to raise the debt limit; 
  • and, if that happens, and I assume it will, this will be the 50th time the debt limit will be raised under a Republican president; almost double the number of times (29) that it has happened under a Democratic president.

 

In The End, It Wasn't Pelosi, It Was Schumer -- January 17, 2025

Link here.

The man who threw Biden under the bus before the latter did it to himself, politically.

A Reply To A Reader's Concern About "Inflation Lasting Longer" -- January 17, 2025

 

Yes. Inflation will last longer. So, what's new? I think everyone knows that. But it's all relative.

US inflation rate, historical.




Investors in the equity market will eventually be more interested in the economy of the US and less interested in whether the Fed makes any more cuts this year, once they realize the Fed won't be making any more cuts this year. But they may not raise rates either?

I remain fully invested in equities betting on the US economy and don't give much thought to what the Fed does (for my personal investing). For me, it's mostly a spectator sport. Jamie Dimon has interesting thoughts on inflation today, in line with my thoughts, and quite strange for a banker, particularly Jamie Dimon, to say that.

I can't believe how good the market did the past two years with high inflation, high interest rates ... and now more of the same?

My wife will love the return she is getting on her fixed income investments.

On a completely different note: if the consensus is that interest rates / inflation will continue to rise, better to buy a house / car now. The $600 monthly car payment now (on a seven-year loan) or $3,000 monthly mortgage on a 30-year house will look very, very "cheap" three years from now. Those new car loans will increase to $750 / month and the mortgages will increase to $4,500. 

As far as the end-of-year money Biden released, it was already in the political pipeline -- just a lot of inside debates about how to spend it -- and it will pale in comparison to how much Trump is going to spend in 2025. And, if California wants any money for the fires, they're going to have to agree to raising the debt limit or getting rid of it altogether.The GOP seems better at doing this than the DEMS.



Friday, January 3, 2025

Auto Sales -- 2024

See this post.

CNBC here

My not-ready-for-primetime reply to a reader who sent me the story about auto sales increasing year-over-year:

As an investor, it's always about a) volume; and, b) margins. If you sell 4% more vehicles y/y but your margins decrease significantly, one's profit (all else being equal) will fall y/y.

So, the question is this: "did Ford have to do more discounting in 2024 to increase sales?"

And the answer is, according to google AI:


Also, need to compare with overall market. Earlier from the blog:

All numbers need to be fact-checked, but in very general and in some cases, very round numbers, number of vehicles sold in the US by these manufacturers, 2023:

  • Toyota: about 2.8 million vehicles
  • GM: about 2.6 million vehicles (an increase of 14% y/y)
  • Honda + Nissan: about 2.2 million vehicles [Honda, 1.3 million; Nissan, 0.9 million]
    • Honda: an increase of 33% y/y
    • Nissan: an increase of 23% y/y
  • Ford: 1.9 million vehicles (an increase of 7.9%)
  • Hyundai Kia: 1.65 million vehicles
That was 2023. But two data points stand out.

33% increase y/y/ for Honda; 8% increase y/y for Ford.

And if y/y (2023/2022 was 8%) and then this y/y (2024/2023 was 4% ....
********************

The big story, of course, the EV is dead in the US and its prospects don't look better with Trump in the White House. As Dan Rather would say the future of EVs in the US is slim, slim just left town.


Ford (F) is still paying an incredible dividend. And it certainly appears that the dividend is propping up the share price: https://www.nasdaq.com/market-activity/stocks/f/dividend-history.
 
P/E: 11.

Market cap: $40 billion.