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Alcoa Inc. Message Board

wgrsh 283 posts  |  Last Activity: 21 hours ago Member since: May 11, 2005
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  • Reply to

    AFTER HOURS

    by mcavallero62 21 hours ago

    Just 1700 shares ... went through during the day and missed, I assume

  • Reply to

    Seattle or New England?

    by dilo133 22 hours ago

    I'll have to see if I'm going to drink Starbucks or Sam Adams ... have to say Alaskan Amber is pretty good.

  • Reply to

    Short end increase or Long end increase?

    by wgrsh Jan 28, 2015 4:14 PM

    jhitcher ... I think your money supply formula is the same (generally) as the one I said with the variables solved for GDP. If velocity shrinks you have to print more money or the economy (GDP) shrinks ... deflation. The Fed had to print money, and as they did the money supply rose back to the level before velocity sank ... status quo maintained ... until the latter QEs that is ... they were to stimulate. That was the whole point of Bernanke being a student of the 1930s ... back then they didn't recognize velocity dropping, so didn't counteract it (or if they did recognize it, didn't do anything about it). It was also the main worry about the EU not being able to do a QE ... they wouldn't be able to counteract deflation.

    In most economic books velocity is a constant, so there is no discussion of what happens if it does change ... maybe in a footnote depending on the book.

    Thanks for the insights about the impact of moving the long end. As I mentioned, just wondering that if the economy is improving why not nudge the long end first (but maybe shouldn't toy with a bubble). Maybe with the current level of interest rates, a flat yield curve doesn't matter. So maybe my concern won't matter if the Fed if it only goes after the short end.

  • // Parker buys AAL at cheap because Parker sees value? //

    unc ... suppose he does. Not a student of buybacks ... what would you use as a guide. Buy when the inverse of the PE is greater than margins (on pullbacks of course)? Maybe it's greater than the firm's cost of capital? If I learned the rationale at some point in my life, I forgot it. Anyone have a rule of thumb?

  • wgrsh wgrsh Jan 29, 2015 1:36 PM Flag

    // based on 700m shares diluted. //

    unc, think you have to use 719m diluted for Q1 (unless you're counting on more buybacks this Q)

  • wgrsh wgrsh Jan 29, 2015 1:19 PM Flag

    // use the worst part of guidance and not midpoint for costs //

    If their costs are at the high end of guidance then it is what the analyst say. Let's hope the analysts' estimates stay there ... fine with me.

    At this point in the quarter fuel is probably close to locked in at midpoint.

  • wgrsh wgrsh Jan 29, 2015 1:08 PM Flag

    HA has been a good one.

  • wgrsh wgrsh Jan 29, 2015 12:54 PM Flag

    // jblu outperform everyone in group //

    Even HA?

  • wgrsh wgrsh Jan 29, 2015 12:49 PM Flag

    // let them guide low, and hopefully beat. //

    markus ...If analysts estimates stay where they are, that will allow a beat. The other day I made a mistake when figure Q1 ... grabbed a wrong number. Anyway, using midpoint costs and midpoint revenue guidance (and assuming I pulled the right numbers), I get $1.93, which is a beat. Go from there and look at the monthly reports. Hope the analysts stay at $1.81.

    Still get a much higher beat for the full year.

  • wgrsh wgrsh Jan 29, 2015 11:23 AM Flag

    At $60/bbl, AAL's earnings estimates are still too low.

  • Reply to

    Who's Selling AAL?

    by carruthersdevelopers Jan 29, 2015 9:44 AM
    wgrsh wgrsh Jan 29, 2015 11:03 AM Flag

    // Face it, oil won't be this cheap for long ... //

    That is debatable ... who knows? But if oil goes from $50/bbl to 65/bbl, where, let's assume, it's at a level that gives us drill, drill, drill, that is a $15 increase, or $15/42 gals is a 36 cent increase in fuel assuming the crack spread and into plane fees, transportation, etc. are constant. AAL (and airlines) still save big time giving earnings above this year's estimates. And then you also have to consider AAL is replacing their fleet with aircraft 10% more fuel efficient. I'd let this play out a bit. True, AAL is fully valued with oil at $105/bbl ... but oil isn't that ... reality.

  • Reply to

    Less Personal Space Comment

    by wgrsh Jan 29, 2015 7:45 AM
    wgrsh wgrsh Jan 29, 2015 9:04 AM Flag

    Can't imagine Vicki Bryant, an airline analyst, saying something that is so wrong. Of course when I realize the "negative" analysts don't know what they are talking about, it's not so bad.

    That extra "roomy" capacity is almost CASM free ... right to the bottom line as the seats are filled ... only a potential positive to revenue.

  • // Bryan (an "analyst" downgrading yesterday) said American may lose passengers as it adds seats to many of the aircraft in its fleet, which translates to "higher fares for reduced personal space for flyers."

    Now I may have this wrong, but aren't the added (new) seats just due to higher seating capacity of new aircraft replacing a lower capacity, older aircraft, and not due to squeezing in more seats in the same size aircraft? So, no reduction in personal space?

  • Reply to

    Short end increase or Long end increase?

    by wgrsh Jan 28, 2015 4:14 PM
    wgrsh wgrsh Jan 29, 2015 12:08 AM Flag

    Money supply is (printed money X velocity of money). An economy of a given size needs a certain money supply to maintain it (or risk deflation or inflation). During the financial freeze the velocity of money collapsed and therefore the Fed did QE1, and that wasn't enough and QE2 was done ... most, but not all, of QE3 was to stimulate, I agree, but disagree with your interpretation of 1 & 2. 1 & 2 solved the velocity problem. I suppose saving the economy from deflation could be called a stimulation, but really it was to maintain.

    I'm sure if velocity started to increase and the maturing rate of the Fed's balance sheet wasn't enough to counter the velocity, the Fed wouldn't hesitate to start selling. But some of the Fed balance sheet is there just for stimulating reasons and that could be sold off regardless of velocity.

    It would depress long debt ... but we didn't need this current rise in bonds anyway at least not for economic reasons. It would also give the Fed room to raise short term rates without flattening the yield curve, which the yield curve is doing right now. I have not finished running the impact of that through the rest of the world though ... so still thinking about it, and that is why I brought it up on the board ... just to get some thoughts. Thanks

  • Reply to

    It is not credit suisse.

    by arnoldboils Jan 28, 2015 10:47 PM
    wgrsh wgrsh Jan 28, 2015 11:29 PM Flag

    boils .... Energy is a supply issue, not a demand issue. Copper is economically sensitive, but what if there is another reason. Almost all agricultural, metals, etc are dropping. For example, rough rice has almost dropped 33% over the short term (there is really no economic reason for it dropping). I would think that if some commodities were being impact by something other than an economic reason that something is impacting almost all commodities, and maybe we are just returning to normalcy. And there is a non-demand rationale for it, and it is aimed at commodities. True or not true, that point of view ought to be considered.

  • wgrsh wgrsh Jan 28, 2015 11:00 PM Flag

    unc ... all is true about LUV ... and you have to pay up to own it.

    Just a side note ... AAL had a higher domestic PRASM increase in Q4 than LUV did in Q4.

  • wgrsh wgrsh Jan 28, 2015 7:12 PM Flag

    // I think buying a stock on an earnings release is usually just gambling. //

    I know a guy that does work surrounding the volatility around earnings. He dusted off some of his old work and looked at it. He said currently used programs are archaic, but now he's been able to isolate more/all the variables that currently used programs don't consider. He has plans for his insights. Anyway, if you think things may be goofy (or don't make sense), they probably are goofy (or don't make sense) ... some of the programs used are like dicing onions with a dull ax. Guess you cry either way. And who knows if the current systems get it right or wrong.

  • Reply to

    Filled the gap from about 7 days ago.

    by prj3553 Jan 28, 2015 4:36 PM
    wgrsh wgrsh Jan 28, 2015 6:56 PM Flag

    Also, it is a high to a low, not a close to an open.

  • Reply to

    Filled the gap from about 7 days ago.

    by prj3553 Jan 28, 2015 4:36 PM
    wgrsh wgrsh Jan 28, 2015 6:52 PM Flag

    I have a high of 49.97, 1/16/2015 and low of 49.93, 1/20/2015. At some point on that day I thought it was going to leave a gap, but didn't looked closely at it until the next day, and it was showing filled. My charts come from a trading platform from a major broker. So, go figure ... unless there were trades not recorded during the day that were corrected after hours ... I don't know.

  • Reply to

    credit suisse mixed the super bowl

    by a42unateinvestor Jan 28, 2015 12:37 PM
    wgrsh wgrsh Jan 28, 2015 5:56 PM Flag

    unc ... are you saying "less worse" is not "good"?

    All companies have little problems here and there ... don't want disasters though. If there was any time to have "less worse" it is when oil more than doubles your earnings.

    I wonder if Parker was really running the airline as if oil was at $105, if he would be handing out an extra 4%? Maybe if the unions turn down the contract, he should delay any good faith gesture until oil's trend is confirmed.

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