Sorry to be the bearer of bad news.
 

Guys,

The chart below, ( Credit Steven Van Metre,) shows the historical correlation between energy prices, the housing market & the economy as a whole. The red line being energy prices. The blue line housing prices. The grey areas when recessions occurred.

if you look closely, you’ll see that every time energy prices spiked, it had a negative impact on housing prices & the economy….

This, combined with the highest inflation report in 31 years, compels me to recommend a “re-allocation” of portfolios now.


HD

At least my home heating costs have increased 30-60%. So I’ve got that going for me.

Correlation doesn't equal causation, past performance is not an indication of future results, etc.


That being said, yeah, the inflation will hurt us at some point, if it isn't already. The real question is "how bad?"

Pretty sure we are facing another lost decade type situation (but hopefully not that long). Especially if Covid takes another swing in early 2022.

I agree with you. :/


HD

I disagree about a lost decade situation. Will a recession hit and knock ridership down for a year or two? Likely could be. Will it be a back swan as bad as 9/11, coupled with with increase of retirement age by 5 year? No, I do not see that.

You forgot the other black swan event with the housing collapse, 6 legacies consolidated into 3 and basically everyone in bankruptcy at some point along the way.

1. The housing collapse (liar loans, Fannie Mae, mark to market) resulted in a recession (included in the likelihood of a one to two year recession, above). That impacts number of passengers. But it was not a lost decade.

2. Consolidation of legacies did not have a major impact on number of passengers, although it did increase load factors. Do you anticipate more consolidation of the legacies? I do not. Buy outs of LCC or consolidations of LCC are possible. But they will not have an impact on overall number of passengers. All flights have been running pretty full, pre Covid. So, not much of an opportunity to consolidate the number of flights in the majors, taken as a whole.

3. Everyone going through bankruptcy had an impact on wages. It did not have a major impact on the number of passengers.

It is number of passengers and number of flights that impact the number of pilots. That was the subject of this.

[QUOTE=TransWorld;3321757]1. The housing collapse (liar loans, Fannie Mae, mark to market) resulted in a recession (included in the likelihood of a one to two year recession, above). That impacts number of passengers. But it was not a lost decade.

It helped to ensure it became a decade.

2. Consolidation of legacies did not have a major impact on number of passengers, although it did increase load factors. Do you anticipate more consolidation of the legacies? I do not. Buy outs of LCC or consolidations of LCC are possible. But they will not have an impact on overall number of passengers. All flights have been running pretty full, pre Covid. So, not much of an opportunity to consolidate the number of flights in the majors, taken as a whole.

I don’t anticipate more consolidation at legacies but the initial consolidation led to another round of furloughs at a few carriers. Ual specifically.

3. Everyone going through bankruptcy had an impact on wages. It did not have a major impact on the number of passengers.

Impact on wages. Lol. Yeah you could say that. Cost millions in the long run over a career. Thats part of why it was a lost decade.

It is number of passengers and number of flights that impact the number of pilots. That was the subject of this.[/QUOTE

Pilots we’re furloughed multiple times over the decade. Pretty sure that meant the number of flights and paxs were impacted but I’ll just take your word on flights and paxs numbers.

Of course there have been pilots furloughed at various times over any decade. But they are not a “lost decade” across the board for the entire industry. Pan Am furloughed all their employees in 1991. Braniff furloughed all their employees in 1982. Even last year Compass and Trans States regional furloughed all their employees. But they were not across the board, industry wide massive furloughs that lasted for 10 years.