Boeing Shares Halted Pending News(twitter.com)
twitter.com
Boeing Shares Halted Pending News
https://twitter.com/cheddar/status/1219701109108899843
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Update: It's resumed trading. News was that the FAA would delay ungrounding of 737 Max until June/July at earliest, months later than Boeing originally promised.
Boeing 737-800 crash landing in 2009 already highlighted the same general issues as with 737 MAX:
https://www.dailymail.co.uk/news/article-7909915/Design-shor...
>New York Times cites unpublished Dutch report on Turkish Airlines crash from 2009 in which nine people were killed near Amsterdam
>Dutch investigators determined that design flaws led to the Boeing 737-800 crashing into a field
>Investigators found that a sensor mistakenly triggered a command computer to idle the engine as the plane approached the runway for landing
>But American investigators with the US government and Boeing pressured the Dutch investigators to emphasize pilot error while downplaying Boeing's role
And that about simulator sounds very familiar too:
>Boeing has stopped production of the planes and agreed to allow pilots to undergo simulator training before the jets return to service.
https://www.dailymail.co.uk/news/article-7909915/Design-shor...
>New York Times cites unpublished Dutch report on Turkish Airlines crash from 2009 in which nine people were killed near Amsterdam
>Dutch investigators determined that design flaws led to the Boeing 737-800 crashing into a field
>Investigators found that a sensor mistakenly triggered a command computer to idle the engine as the plane approached the runway for landing
>But American investigators with the US government and Boeing pressured the Dutch investigators to emphasize pilot error while downplaying Boeing's role
And that about simulator sounds very familiar too:
>Boeing has stopped production of the planes and agreed to allow pilots to undergo simulator training before the jets return to service.
We should stop talking about this as an engineering defect that the FAA needs X number of months to review.
The root cause is not an engineering defect, but a set of organizational, cultural, and managerial defects. This is the root cause that leads inexorably to a variety of seemingly unrelated engineering defects.
Perhaps regulators should hold off on approving new airplanes until Boeing can demonstrate that they have fixed the organizational, cultural, and managerial defects that are the root cause of their safety problems.
The root cause is not an engineering defect, but a set of organizational, cultural, and managerial defects. This is the root cause that leads inexorably to a variety of seemingly unrelated engineering defects.
Perhaps regulators should hold off on approving new airplanes until Boeing can demonstrate that they have fixed the organizational, cultural, and managerial defects that are the root cause of their safety problems.
Question: how much would it cost Boeing if the 737 MAX was never allowed to fly again? Could it bring them down, on the brink of bankrupcy, or is it something they could stomach?
Without "doing the math" - I'd say they'd get bailed out by the US government since Boeing is a huge provider of military hardware.
Ha, that's the answer actually, what it'll come down to if it must. Thanks for the insight.
I expect they don't need bailing, they do so much more than a single airplane model.
I agree that it would be unlikely to tank enough that it needs a bailout, but it could significantly hurt.
They have a large stock of undelivered 737 MAX airplanes (~400 brand-new planes sitting in parking lots), and wouldn't be paid for them. They also wouldn't be able to deliver on any existing 737 MAX contracts.
They have a large stock of undelivered 737 MAX airplanes (~400 brand-new planes sitting in parking lots), and wouldn't be paid for them. They also wouldn't be able to deliver on any existing 737 MAX contracts.
You never know. Companies like Boeing create LTAs with their suppliers, agreeing to specific pricing over many numbers of years.
Most of these contracts are written with language that if a part is no longer required that Boeing must still buy out the LTA. Basically, Boeing must buy parts for the 737 Max from suppliers even if they can never build another plane! Either that or the suppliers who make parts for the 737 will have to eat all the WIP and inventory costs which would be just as devestating to the domestic manufacturing market as if Boeing itself went under.
Aerospace is a yuuuuuge market for American Manufacturing. It's one of the only manufacturing markets that China is unable to compete in.
Most of these contracts are written with language that if a part is no longer required that Boeing must still buy out the LTA. Basically, Boeing must buy parts for the 737 Max from suppliers even if they can never build another plane! Either that or the suppliers who make parts for the 737 will have to eat all the WIP and inventory costs which would be just as devestating to the domestic manufacturing market as if Boeing itself went under.
Aerospace is a yuuuuuge market for American Manufacturing. It's one of the only manufacturing markets that China is unable to compete in.
I don't really understand halting share trading. Who is the exchange to say who may or may not trade a product you own? It just seems weird. If there's bad news, the people who pay attention most closely, and get access to that information the fastest should be allowed to use it, surely?
It’s to prevent flash crashes. If you don’t like the rules of the exchange you can always trade your securities elsewhere (eg otc)
To be clear, you as the shareowner can't legally do this. The company took the decision to be publicly listed in the US, and one of the consequences of that is that shareholders can only buy and sell their stock in accordance with the rules of the exchanges and the SEC. It's not normally a big downside: trading halts are rare and short.
I've realized that everything I own it is because I have permission to own (and someone else, permission to sell). Property rights have not been properly defended so they are fading away.
I was reading Stripe and Braintree's restricted businesses (https://stripe.com/restricted-businesses) and saw "unauthorized sale or resale of brand name or designer products or services". If I own something physical there should be nothing telling me I can't sell it.
I was reading Stripe and Braintree's restricted businesses (https://stripe.com/restricted-businesses) and saw "unauthorized sale or resale of brand name or designer products or services". If I own something physical there should be nothing telling me I can't sell it.
Regulation of commerce is one of the powers we explicitly set out as belonging to the government. In the American system free trade is a reflection of some of our values but not some inherent unalienable right.
> I was reading Stripe and Braintree's restricted businesses (https://stripe.com/restricted-businesses) and saw "unauthorized sale or resale of brand name or designer products or services". If I own something physical there should be nothing telling me I can't sell it.
Property rights also apply to Stripe, in that the company, as an asset itself, can be restricted by its owners to conduct business in some certain way.
And I wouldn't be surprised if Stripe's policies will have more to do with the credit card companies than Stripe. Then, further, the credit card companies act as a cartel by using the government to prevent anyone else from using property to create a competing service by making the ROI on creating a competing service worse than other investment opportunities, or even just blocking it outright under some nebulous "shut down for accounting irregularities" or "insufficient consumer protections" nonsense.
Property rights also apply to Stripe, in that the company, as an asset itself, can be restricted by its owners to conduct business in some certain way.
And I wouldn't be surprised if Stripe's policies will have more to do with the credit card companies than Stripe. Then, further, the credit card companies act as a cartel by using the government to prevent anyone else from using property to create a competing service by making the ROI on creating a competing service worse than other investment opportunities, or even just blocking it outright under some nebulous "shut down for accounting irregularities" or "insufficient consumer protections" nonsense.
When someone speaks of property rights, they usually mean their own rights, not others'.
> When someone speaks of property rights, they usually mean their own rights, not others'.
This is completely your own assertion and suggests a lack of understanding of property rights. How can I talk about property rights under the assumption that they apply only to me, unless I believe that I am the only one in the universe with property rights?
This is completely your own assertion and suggests a lack of understanding of property rights. How can I talk about property rights under the assumption that they apply only to me, unless I believe that I am the only one in the universe with property rights?
> I wouldn't be surprised if Stripe's policies will have more to do with the credit card companies than Stripe
That's what i figured, which is why I included braintree to not throw Stripe under the bus alone.
That's what i figured, which is why I included braintree to not throw Stripe under the bus alone.
Indeed, this is the first time I heard such a thing is even possible. When buying stock I got the impression I would own that part of the company and never read that I may not be able to sell that property if the company in question so wishes. I thought it was a relatively liquid investment but apparently not necessarily so?
Shares are often halted for major news. I think it’s meant to protect sellers from situation where many sell with a market order and the price goes near 0. This would result in a wealth transfer from more naive “Main Street” traders to “Wall Street” market makers. Although if the market makers are effective enough, you wouldn’t need the halt at all.
Do people even hold the physical stock titles anymore? There is nothing preventing someone from selling a physical title. Its why I'm weary of a cashless society.
Stocks are not bearer instruments.
Anyway, you are going to sell your paper certificates in the few hours trading is halted? To whom? Your next for neighbor? Someone on the sidewalk?
Anyway, you are going to sell your paper certificates in the few hours trading is halted? To whom? Your next for neighbor? Someone on the sidewalk?
They should have paused all building of the 737MAX long ago, and switched to other models. The 777 in particular seems to at least have a stellar reputation still.
You can't really just up and retool a production line for a one year delay. Even switching to 737NG isn't really possible.
And the triple 7 isn't a replacement for the MAX. It has double the passenger capacity. It's like if Ford had to stop manufacturing Fiestas and manufactured F-150s in their place. These are different markets.
And the triple 7 isn't a replacement for the MAX. It has double the passenger capacity. It's like if Ford had to stop manufacturing Fiestas and manufactured F-150s in their place. These are different markets.
It should have been pretty obvious that this plane was a turkey and that building more of them was just throwing good money after bad.
Meanwhile, they could have been producing more planes that don't have problems, and actually sell, even if they are for different markets. There's a backlog for all planes, so switching to something else would have at least helped clear that backlog and net more profit, instead of just building more planes that are just going to sit in parking lots.
While doing this, they should have immediately started work on engineering for an all-new replacement for the 737.
Of course, instead of having me as their CEO, Boeing would rather have some clown like Muilenberg who makes stupid decisions that got them to where they are now, and then give him a giant golden parachute when they get rid of him for incompetence. I would have cost far less.
Meanwhile, they could have been producing more planes that don't have problems, and actually sell, even if they are for different markets. There's a backlog for all planes, so switching to something else would have at least helped clear that backlog and net more profit, instead of just building more planes that are just going to sit in parking lots.
While doing this, they should have immediately started work on engineering for an all-new replacement for the 737.
Of course, instead of having me as their CEO, Boeing would rather have some clown like Muilenberg who makes stupid decisions that got them to where they are now, and then give him a giant golden parachute when they get rid of him for incompetence. I would have cost far less.
I don't think a Dow component has ever been halted before, so this is highly unusual.
Shares crashed more than 5.5% in the 30m or so before it was halted.
Shares crashed more than 5.5% in the 30m or so before it was halted.
I hope everyone who sold in those 30 minutes has a good non-insider-trading story.
Stock markets seem full of insider traders who are rarely punished, and who keep people like me from investing.
Stock markets seem full of insider traders who are rarely punished, and who keep people like me from investing.
From the video: The FAA have already announced it may be June/July before the 737 can be reapproved, and the previous guidance was April/May. That's the news that caused the initial drop, but apparently there's further news to come that caused the halt.
EDIT: Apparently the further news was just Boeing's confirmation of the above.
EDIT: Apparently the further news was just Boeing's confirmation of the above.
> I don't think a Dow component has ever been halted before, so this is highly unusual.
What do you mean? Stocks get halted all the time especially before big news.
What do you mean? Stocks get halted all the time especially before big news.
Dow component...
Though someone mentioned JNJ did. Otherwise it's very uncommon for a blue chip to be halted.
Though someone mentioned JNJ did. Otherwise it's very uncommon for a blue chip to be halted.
AAPL had a trading halt last January [0], pending a profit warning. Google will likely find dozens if not hundreds more halts in Dow components.
[0] https://thefly.com/landingPageNews.php?id=2842788
[0] https://thefly.com/landingPageNews.php?id=2842788
[deleted]
https://investorplace.com/2019/10/merck-and-pfizer-boosted-t...
> Shares of Johnson & Johnson (NYSE:JNJ) were halted in late trading pending release of news. The news turned out to be that Johnson and Johnson said it found no asbestos in the baby powder it recalled. JNJ was trading slightly lower prior to the trading stop, but is up over 3% after the close.
(J&J is a Dow component.)
https://www.sec.gov/fast-answers/answerstradinghalthtm.html
> A trading halt—which typically lasts less than an hour but can be longer—is called during the trading day to allow a company to announce important news or where there is a significant order imbalance between buyers and sellers in a security.
> Shares of Johnson & Johnson (NYSE:JNJ) were halted in late trading pending release of news. The news turned out to be that Johnson and Johnson said it found no asbestos in the baby powder it recalled. JNJ was trading slightly lower prior to the trading stop, but is up over 3% after the close.
(J&J is a Dow component.)
https://www.sec.gov/fast-answers/answerstradinghalthtm.html
> A trading halt—which typically lasts less than an hour but can be longer—is called during the trading day to allow a company to announce important news or where there is a significant order imbalance between buyers and sellers in a security.
Was it a circuit breaker tripping? Afaik markets often implement them to halt trading if the stock dips too fast too quick.
It was planned given the news, but clearly something leaked beforehand because it dropped significantly in the minutes prior to the halt.
I thought I saw a headline earlier today that said that Boeing was permanently halting production of the 737 Max. It was probably fake news. I can't find any real news on that subject.
Maybe the market today is overreacting to that fake news/rumor?
Maybe the market today is overreacting to that fake news/rumor?
You may be confusing 'officially' with 'permanently'
There's a headline on the front page of HN saying that they've officially halted production.
https://news.ycombinator.com/item?id=22108220
There's a headline on the front page of HN saying that they've officially halted production.
https://news.ycombinator.com/item?id=22108220