WEBVTT - 2024 Hurricane Season, Latest on Boeing

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<v Speaker 1>You're listening to the Bloomberg Intelligence podcast. Catch us live

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<v Speaker 2>And there may be a storm brewing in DC. There

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<v Speaker 2>is definitely a storm brewing in the Caribbean. Apparently there's

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<v Speaker 2>a record breaking hurricane barrel that is intensifying as it

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<v Speaker 2>turns through the Caribbean south of Granada. It has regained

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<v Speaker 2>category four strength after briefly weakening. We're talking top wins

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<v Speaker 2>of one hundred and thirty miles per hour. Well, Matthew

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<v Speaker 2>Palazoa is a senior analyst and P and C insurance

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<v Speaker 2>over at Bloomberg Intelligence and he joins us now. Now, Matthew,

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<v Speaker 2>I know you look at the stuff through the lens

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<v Speaker 2>of insurers, but can you just give us some perspective

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<v Speaker 2>of how you're looking at this storm.

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<v Speaker 3>Yeah, so per perspective. As you had said, the earliest

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<v Speaker 3>Category four in the Atlantic since two thousand and five.

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<v Speaker 3>In two thousand and five was one of the worst

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<v Speaker 3>hurricane seasons on was that Katrina. That was Katrina was

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<v Speaker 3>one of those storms in that year. So right now

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<v Speaker 3>it's early, we're looking at it. It seems to be

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<v Speaker 3>I always look at it. Is it going to impact

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<v Speaker 3>the United States? Right? The islands obviously matter, but generally

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<v Speaker 3>for global insured losses, something on Florida or you know,

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<v Speaker 3>in Texas, Louisiana, those are the kind of big money

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<v Speaker 3>loss events. What it looks like is going to happen

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<v Speaker 3>here is it will probably hit the Yucatan Peninsula, I

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<v Speaker 3>will probably cross a lot of the islands in the

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<v Speaker 3>Caribbean south of the Greater Antilles. But so we're looking

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<v Speaker 3>at that, and we're looking at past events in Mexico.

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<v Speaker 3>In two thousand and five there was also a Wilma

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<v Speaker 3>hit Mexico and caused almost eight billion dollars in economic losses.

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<v Speaker 3>The insured were a lot less. I do think Birtle's

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<v Speaker 3>going to slow down though, so it probably wouldn't be

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<v Speaker 3>that bad.

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<v Speaker 4>What's it tell you or what is it the insurance

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<v Speaker 4>company's telling you about kind of how they view hurricanes,

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<v Speaker 4>other stream events, saying it's always in the news year,

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<v Speaker 4>extreme heat, extreme storm, it's extreme. What are the insurance

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<v Speaker 4>companies say, because they're the ones that actually have, you know,

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<v Speaker 4>money at stake here.

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<v Speaker 3>Get in the game, on in the game. So what

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<v Speaker 3>they will say is climate change is having an impact.

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<v Speaker 3>You wouldn't directly blame all these things on climb she

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<v Speaker 3>It's very hard to exactly say. One of the good

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<v Speaker 3>things about the global industry though, is that it realprices

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<v Speaker 3>on an annual basis. Right, Generally, all these policies are

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<v Speaker 3>written every year, so they can reprice things as they

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<v Speaker 3>go along. They could leave regions as they go along.

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<v Speaker 3>You are hearing these record breaking things. Even last year,

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<v Speaker 3>which would turn out to be a mild hurricane season,

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<v Speaker 3>there was a bunch of activity earlier in the season.

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<v Speaker 2>So based on that, what the areas in the US,

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<v Speaker 2>for example, that are exposed to these kind of intense

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<v Speaker 2>changing storms. Are insurers still ensuring houses there?

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<v Speaker 5>Like?

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<v Speaker 2>Are they still doing the job? Or has all the

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<v Speaker 2>stuff changed? That was a really intelligent question. Do the

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<v Speaker 2>stuff or has the stuff changed?

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<v Speaker 3>Some stuff has changed, some stuff hasn't. So the insurers

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<v Speaker 3>are leaving certain areas, mostly California, honestly, Florida. The Florida

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<v Speaker 3>market interesting is that wildfires peace, yes, wildfires, and the

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<v Speaker 3>regulation is tough in some of these states too, So

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<v Speaker 3>what you saw in Florida was a litigious environment that

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<v Speaker 3>was driving up a lot of costs, and insures and

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<v Speaker 3>reinsures pulled out of there. The state has done a

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<v Speaker 3>lot of things to address that. So you see insurance

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<v Speaker 3>companies actually tending to start to go back.

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<v Speaker 4>Didn't warn Buffet come go back.

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<v Speaker 3>So Buffett Berkshire's reinsurance unit had a big bet on

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<v Speaker 3>Florida last year. We don't actually know they didn't. They

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<v Speaker 3>disclosed it at the annual meaning last year. They didn't

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<v Speaker 3>talk about it this year necessarily, so we don't exactly

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<v Speaker 3>know if they're there. I would suspect they probably are,

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<v Speaker 3>but I can't confirm.

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<v Speaker 4>Okay, So, but if I'm want to go out and

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<v Speaker 4>buy a condo down in Florida on the coast, can

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<v Speaker 4>I get that insured?

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<v Speaker 3>You can? What is happening? You probably won't get it insured,

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<v Speaker 3>by the way, in case you're wondering you can. It

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<v Speaker 3>will probably be through a Florida company, like a smaller

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<v Speaker 3>insurance company probably not going to get you know, and

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<v Speaker 3>you might get an all state I don't know, but

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<v Speaker 3>you're not going to get one of these probably national

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<v Speaker 3>name brands. You'll probably get a smaller company, You're definitely

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<v Speaker 3>going to pay a high price. You may even get

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<v Speaker 3>it through the state fund. So Alex to your other

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<v Speaker 3>question before. One of the things that is happening is

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<v Speaker 3>that a lot there's an insurer of last resort in

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<v Speaker 3>a lot of these states, so it's essentially the state

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<v Speaker 3>insurance company. It's not it's an insurance company, so it's

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<v Speaker 3>not like just backed by taxpayer money. It's supposed to

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<v Speaker 3>be self sufficient, but it can always rely on the state.

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<v Speaker 3>So a lot of people will end up getting insured

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<v Speaker 3>through those mechanisms.

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<v Speaker 2>So what about reinsurance.

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<v Speaker 3>So the reinsurance market really, I think is returning to Florida.

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<v Speaker 3>So these things that were hurting it, it's kind of

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<v Speaker 3>a wait and see. The prices went up a lot,

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<v Speaker 3>especially for catastrophe ponent regions stuff like Florida, So it

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<v Speaker 3>became to pulse point earlier. It became attractive to some

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<v Speaker 3>companies like Berkshire Hathaway to get back into these markets.

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<v Speaker 4>How are these property and casually stocks trading or they did?

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<v Speaker 4>Are they trading on the fundamentals of each company, Are

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<v Speaker 4>they faitting on a trade or do they typically trade

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<v Speaker 4>on interest rates?

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<v Speaker 3>How do they trade? So the P and C companies

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<v Speaker 3>trade less on interest rates than life insurance companies. The

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<v Speaker 3>life insurance companies are way more levered assets to equity.

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<v Speaker 3>They have bigger portfolios. Uh, you know these names, they'll

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<v Speaker 3>tend to move on pricing in the cycle. Sometimes the weather,

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<v Speaker 3>interest rates will will help. They were kind of in

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<v Speaker 3>line with the market this year. Some have done better.

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<v Speaker 3>So the auto insurance companies are doing a little bit better.

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<v Speaker 3>We probably talked about that in the past, but they

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<v Speaker 3>were having huge increase in the loss costs, so cars

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<v Speaker 3>were more expensive to fix and that is kind of

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<v Speaker 3>abating a bit. So those names have done better.

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<v Speaker 2>What about rates, So FED cuts interest rates, how does

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<v Speaker 2>that affect the insurance market? And does it matter as much?

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<v Speaker 2>Considering that some of these places are gonna get hit

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<v Speaker 2>no matter what because of all the changing.

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<v Speaker 3>Weather, so it won't matter on the underwriting side much.

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<v Speaker 3>Potentially it could in that interest rates could they help

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<v Speaker 3>investment income, which could subsidize underwriting, But realistically lower interest

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<v Speaker 3>rates will hurt investment income depending on how low they go,

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<v Speaker 3>maybe not dramatically. It probably does not change underwriting decisions though,

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<v Speaker 3>But net net lower rates are a bad thing for

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<v Speaker 3>these companies.

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<v Speaker 4>All right, i'mp buying property and casualty insurance stocks. What

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<v Speaker 4>kind of dividend yields am I getting on these things?

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<v Speaker 3>They're not dramatically high. I mean they're you know, probably

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<v Speaker 3>less than what you'd get on the SMP. I mean

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<v Speaker 3>it's like it's two or three percent. I don't think

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<v Speaker 3>they love to be locked into returning capital, so they'll

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<v Speaker 3>favor share a purchase instead. And are they doing that, yeah,

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<v Speaker 3>I mean they're buying back shares. They'll they'll tend to

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<v Speaker 3>pause during hurricane season.

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<v Speaker 5>This is.

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<v Speaker 3>By some estimates. Quote the hurricane season from Hell coming

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<v Speaker 3>up that that was a headline. Was clickbait or not,

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<v Speaker 3>but it was a headline. So you may see, you know,

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<v Speaker 3>the second third quarter repurchase slow down. But that's usually

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<v Speaker 3>the main mechanism.

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<v Speaker 2>What about consolidation in this industry. You mentioned some state

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<v Speaker 2>smaller players, say in Florida. What does that wind up

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<v Speaker 2>looking like?

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<v Speaker 3>I don't think you're gonna see big consolidation in the industry.

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<v Speaker 3>So there's a completely separate issue with liability loss reserves

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<v Speaker 3>where they write these they write these policies and then

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<v Speaker 3>many years later they may have claims on them. And

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<v Speaker 3>that is starting to rear its head in terms of

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<v Speaker 3>we didn't get maybe great pricing years ago, So I

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<v Speaker 3>think it's going to be a headwind to large consolidation.

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<v Speaker 3>You may see it on the smaller side. Companies that

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<v Speaker 3>I don't necessarily even cover, like those maybe smaller Florida

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<v Speaker 3>names might get scooped up. There are companies that are

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<v Speaker 3>starting up and taking policies out of the state fund,

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<v Speaker 3>which is not necessarily consolidation, but it's kind of helping

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<v Speaker 3>and that's a business. But when when they get whacked

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<v Speaker 3>by a hurricane, you know, we'll see how those companies do.

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<v Speaker 4>What's the best idea in insurance these days? What people

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<v Speaker 4>want to talk about the most.

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<v Speaker 3>I mean, the reinsurance story seems to have played out

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<v Speaker 3>a little bit. You know that the reserves are an issue,

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<v Speaker 3>Climate change is an issue. Cyber insurance is a kind

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<v Speaker 3>of big issue. You've seen this now with the auto dealers, right.

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<v Speaker 3>Some estimates say it could be the biggest line of

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<v Speaker 3>insurance eventually. What the insurance companies have done historically is

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<v Speaker 3>kept limits very low on this, so even in a

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<v Speaker 3>big event, they're only paying out a small amount. But

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<v Speaker 3>someone say it's actually an uninsurable risk that it's completely correlated.

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<v Speaker 3>So they want to stay away from things that could

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<v Speaker 3>affect a huge group like a flood that could flood

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<v Speaker 3>a state or something like that. This is something they

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<v Speaker 3>could shut down, you know, swaths of the country, so

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<v Speaker 3>they want to stay away from it.

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<v Speaker 2>Well, we appreciate it, thank you very much, Matthew Palizoa.

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<v Speaker 2>A Bloomberg intelligency covers everything insurance and reinsurance and then

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<v Speaker 2>by de facto you're like a storm analyst and does

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<v Speaker 2>the weather for us as well. So we do appreciate that.

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<v Speaker 2>But that's kind of scary, right, like already a category

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<v Speaker 2>four storm and it's.

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<v Speaker 4>Only what is it because the map, Yeah, yeah, Matt's

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<v Speaker 4>got a great the map from the one of those

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<v Speaker 4>mapping people that go out there and coming cutting right

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<v Speaker 4>across the Caribbean, right across the also hitting the Mexican peninsula,

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<v Speaker 4>So that could be harsh for our good friends and

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<v Speaker 4>like cancoon things.

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<v Speaker 2>Like that bikes. Yeah, it doesn't look very good there.

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<v Speaker 1>You're listening to the Bloomberg Intelligence Podcast. Catch us live

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<v Speaker 1>Just Say Alexa playing Bloomberg eleven thirty.

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<v Speaker 4>Wait Busy twenty four hours for Boeing. The US Justice

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<v Speaker 4>Department plans to charge Boeing with criminal fraud after finding

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<v Speaker 4>the company violated a twenty twenty one deferred prosecution agreement

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<v Speaker 4>tied to two previous fatal crashes, and Bloomberg News was

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<v Speaker 4>reporting that late yesterday, and then just hours later, Boeing

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<v Speaker 4>announce a plant to buyback Spirit Aero Systems. As Charlie

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<v Speaker 4>is just reporting a supplier that hit it spun off

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<v Speaker 4>two decades ago. They're gonna pay four point seven billion

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<v Speaker 4>dollars in a bid to improve manufacturing stock today up

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<v Speaker 4>about two and a half percent of down about twenty

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<v Speaker 4>eight percent year to date. So it's got the Lady's song.

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<v Speaker 4>What's happening at Boeing? Very busy over there with George Ferguson,

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<v Speaker 4>he covers the airlines, he comes to aerospace companies for

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<v Speaker 4>Bloomberg Intelligence. Joe, I mean, George, how do you put

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<v Speaker 4>into context what's happened to Boeing over these last several years?

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<v Speaker 4>Where does the company go from here, So.

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<v Speaker 5>I guess the way I put it in context would

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<v Speaker 5>be a lot of air outsourcing at Boeing, including Spirit

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<v Speaker 5>Aerosystem A couple of decades ago. Seven eight seven was

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<v Speaker 5>one of these watershed events where they were trying to

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<v Speaker 5>outsource large portions of the manufacturer and even does I

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<v Speaker 5>say engineering is probably the better term than design engineering

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<v Speaker 5>on that airplane. And now I think, you know, the

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<v Speaker 5>company in the midst of pulling some of that supplier

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<v Speaker 5>base back in so they can control quality and uh

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<v Speaker 5>and improve production output. So I think I think that's

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<v Speaker 5>where they are, and the and the weekends events are

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<v Speaker 5>I think all, uh, you know, steps on the path

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<v Speaker 5>to improving production, eliminating distractions, improving quality. There's there's more

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<v Speaker 5>to come, more to do, and they need a strong

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<v Speaker 5>recovery in the second half. They can't burn cash like

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<v Speaker 5>they've been burning. But that, you know, That's what I

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<v Speaker 5>would say kind of where we are right now as

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<v Speaker 5>we're in the process of cleaning that whole whole outsourcing

0:11:42.280 --> 0:11:42.679
<v Speaker 5>mess up.

0:11:43.200 --> 0:11:46.079
<v Speaker 2>So as it relates to the to the to the

0:11:46.160 --> 0:11:48.920
<v Speaker 2>fraud charges, et cetera. Do they have to pay a

0:11:48.960 --> 0:11:51.240
<v Speaker 2>boatload of money to people on this or can they

0:11:51.280 --> 0:11:53.839
<v Speaker 2>spend a boatload of money instead on making sure that

0:11:53.920 --> 0:11:56.839
<v Speaker 2>their programs are good and their quality control is good.

0:11:58.200 --> 0:12:01.240
<v Speaker 5>So I'm going to first, you know, caveat this whole

0:12:01.280 --> 0:12:02.920
<v Speaker 5>thing with I'm not an attorney, so that you know

0:12:03.000 --> 0:12:06.280
<v Speaker 5>that we're in some realms there that I don't totally understand,

0:12:07.160 --> 0:12:10.679
<v Speaker 5>but I believe it's something for five hundred million dollars

0:12:10.720 --> 0:12:13.560
<v Speaker 5>worth of fines they'd have to pay if they agreed

0:12:13.600 --> 0:12:16.920
<v Speaker 5>to the current Justice Department proposal, and they'd have to

0:12:17.000 --> 0:12:20.520
<v Speaker 5>bring in and outside I guess, you know, sort of

0:12:20.600 --> 0:12:25.720
<v Speaker 5>quality manager overseer. I think that they have some rights

0:12:25.760 --> 0:12:29.400
<v Speaker 5>to you know, sort of negotiate over who that would be.

0:12:31.240 --> 0:12:37.079
<v Speaker 5>So to me, that doesn't sound like in extremely onerous provisions.

0:12:37.200 --> 0:12:38.840
<v Speaker 5>I think it's something that again they've got to get

0:12:38.840 --> 0:12:41.840
<v Speaker 5>out of their way to start to build more aircraft

0:12:41.880 --> 0:12:45.640
<v Speaker 5>and focus on improving their processes, their production processes. So

0:12:46.800 --> 0:12:49.360
<v Speaker 5>to me, it doesn't sound bad. I don't know what

0:12:49.480 --> 0:12:52.120
<v Speaker 5>the other sort of legal ramifications are here on that.

0:12:53.040 --> 0:12:55.240
<v Speaker 4>How many planes are they building per month now Georgia

0:12:55.240 --> 0:12:56.079
<v Speaker 4>and where do they need to get to?

0:12:57.320 --> 0:13:01.480
<v Speaker 5>So I don't know that we know it looks like

0:13:01.600 --> 0:13:05.160
<v Speaker 5>the second quarter is going to have less deliveries than

0:13:05.200 --> 0:13:07.040
<v Speaker 5>the first quarter. We still have to see what the

0:13:07.120 --> 0:13:11.840
<v Speaker 5>June deliveries were, but through May it was they were

0:13:12.200 --> 0:13:15.120
<v Speaker 5>a lower trajectory than they were in one queue. I

0:13:15.240 --> 0:13:19.560
<v Speaker 5>suspect again, you know, things like uh, managing quality down

0:13:19.600 --> 0:13:23.000
<v Speaker 5>at Spirit or slowing things down. The negotiations with Spirit

0:13:23.000 --> 0:13:26.079
<v Speaker 5>have been throwing slowing things down. The discussion with the

0:13:26.240 --> 0:13:30.480
<v Speaker 5>FAA about the way forward and the processes to make

0:13:30.480 --> 0:13:33.560
<v Speaker 5>sure the quality is higher has been slowing things down.

0:13:34.760 --> 0:13:37.079
<v Speaker 5>And we don't know how many of whatever they delivered

0:13:37.160 --> 0:13:39.839
<v Speaker 5>in two Q was delivered out of the inventory that

0:13:39.920 --> 0:13:41.520
<v Speaker 5>they already built, right they want to get rid of

0:13:41.600 --> 0:13:45.080
<v Speaker 5>that inventory, which is you know, I think really onerous

0:13:45.160 --> 0:13:48.920
<v Speaker 5>on h on efficiency because they need folks to maintain

0:13:48.960 --> 0:13:51.720
<v Speaker 5>airplanes that are already built and sitting in the desert.

0:13:52.640 --> 0:13:54.280
<v Speaker 5>But so either way, we kind of think two Q

0:13:54.480 --> 0:13:58.440
<v Speaker 5>is going to be below one Q a rough rough quarter,

0:13:58.559 --> 0:14:04.719
<v Speaker 5>probably a four billion and plus cash use after you know,

0:14:04.800 --> 0:14:08.680
<v Speaker 5>any sort of maintenance capex. So I think the full

0:14:08.720 --> 0:14:12.360
<v Speaker 5>story here really is three Q and four Q this year.

0:14:12.400 --> 0:14:15.880
<v Speaker 5>They just can't keep burning four billion dollars of cash

0:14:16.760 --> 0:14:19.920
<v Speaker 5>per quarter. And so again I think you see this

0:14:20.400 --> 0:14:23.400
<v Speaker 5>fury of activity as we enter the beginning of summer

0:14:23.440 --> 0:14:26.680
<v Speaker 5>at Boeing, and I think it's all about tidying up

0:14:26.720 --> 0:14:29.320
<v Speaker 5>these issues. They need a tidy so they can get

0:14:29.400 --> 0:14:32.400
<v Speaker 5>at building and delivering a lot more airplanes in the

0:14:32.480 --> 0:14:35.480
<v Speaker 5>second half and lowering cash burn significantly.

0:14:36.160 --> 0:14:38.080
<v Speaker 2>I'm just going to the Spirit thing for a moment.

0:14:38.560 --> 0:14:40.400
<v Speaker 2>So air Bus is going to be taking over parts

0:14:40.440 --> 0:14:44.440
<v Speaker 2>of Spirit that make components for its own aircraft. How

0:14:44.480 --> 0:14:46.520
<v Speaker 2>does that work? Does that make it like a super

0:14:46.640 --> 0:14:49.040
<v Speaker 2>company within Airbus or is it totally going to be

0:14:49.080 --> 0:14:50.800
<v Speaker 2>absorbed by Airbus? What does that look like?

0:14:51.680 --> 0:14:54.680
<v Speaker 5>So, I mean the press release I saw today made

0:14:54.720 --> 0:14:57.600
<v Speaker 5>me believe that it's going to be fully taken out

0:14:57.800 --> 0:15:03.120
<v Speaker 5>of Spirit Aerosit at least large portions of it, and

0:15:03.400 --> 0:15:07.440
<v Speaker 5>pulled into air Bus. I thought much more interesting too

0:15:07.520 --> 0:15:10.200
<v Speaker 5>in that whole disclosure was Airbus is getting paid like

0:15:10.240 --> 0:15:12.320
<v Speaker 5>I think it was five hundred and fifty nine million something,

0:15:12.800 --> 0:15:16.400
<v Speaker 5>just over half a billion dollars to take those businesses,

0:15:16.680 --> 0:15:19.920
<v Speaker 5>to take the businesses and take the assets. So we

0:15:20.120 --> 0:15:23.040
<v Speaker 5>knew that that was a drag on Spirit, and it

0:15:23.080 --> 0:15:25.680
<v Speaker 5>seems like maybe a pretty significant drag again, I think

0:15:25.760 --> 0:15:30.960
<v Speaker 5>something that really helps potentially improve Boeing Quality and throughput

0:15:31.560 --> 0:15:34.360
<v Speaker 5>is a management team not focused on trying to economize,

0:15:34.880 --> 0:15:40.440
<v Speaker 5>especially on a big loss making contracts like the airbus contracts.

0:15:40.800 --> 0:15:43.000
<v Speaker 4>Hey, Georgia, if Bowmen doesn't have enough balls in the air.

0:15:43.080 --> 0:15:45.080
<v Speaker 4>They also now need to find a new CEO because

0:15:45.360 --> 0:15:47.800
<v Speaker 4>chief executive officer David Calhoun, he said he's going to

0:15:47.800 --> 0:15:49.320
<v Speaker 4>step down by year in at the latest.

0:15:49.880 --> 0:15:51.040
<v Speaker 3>Who's going to take this job?

0:15:51.240 --> 0:15:52.640
<v Speaker 2>Oh, that's George's favorite question.

0:15:53.520 --> 0:15:56.320
<v Speaker 5>This is a this is a hard job to take,

0:15:56.840 --> 0:15:58.600
<v Speaker 5>and they would love to have someone in place, I

0:15:58.680 --> 0:16:03.760
<v Speaker 5>think to manage these problems and the upcoming ones. I

0:16:03.800 --> 0:16:07.160
<v Speaker 5>don't know, and there's a lot of speculation in the marketplace.

0:16:07.600 --> 0:16:09.600
<v Speaker 5>I'd be throwing darts at a dartboard. I just know

0:16:09.680 --> 0:16:13.600
<v Speaker 5>it needs to be a good manufacturing person, you know,

0:16:13.680 --> 0:16:19.680
<v Speaker 5>someone someone focused on you know, manufacturing shop floor kind

0:16:19.720 --> 0:16:23.720
<v Speaker 5>of quality. I will tell you, you know, we're going

0:16:23.800 --> 0:16:26.720
<v Speaker 5>to step from these two problems. That are they're going

0:16:26.760 --> 0:16:29.240
<v Speaker 5>to go on to simmer right. You know, Spirit doesn't

0:16:29.280 --> 0:16:32.000
<v Speaker 5>get purchased until sometime next year. There's a lot of

0:16:32.080 --> 0:16:35.240
<v Speaker 5>details to get worked out between now and then. Do

0:16:35.360 --> 0:16:38.680
<v Speaker 5>OJ's you know, they may agree, there's could be they're

0:16:38.720 --> 0:16:40.800
<v Speaker 5>trying to negotiate with them, they could decide not to

0:16:40.920 --> 0:16:43.920
<v Speaker 5>agree end up in a lawsuit. And I'll tell you

0:16:44.000 --> 0:16:46.680
<v Speaker 5>that as we get in September, one of Boeing's the

0:16:46.760 --> 0:16:49.680
<v Speaker 5>most important unions will come to the table. That's when

0:16:49.720 --> 0:16:54.240
<v Speaker 5>their contract expires. And so I so, so the hits

0:16:54.360 --> 0:16:56.880
<v Speaker 5>just keep on coming here, I think, and that will

0:16:56.920 --> 0:16:59.640
<v Speaker 5>be another very interesting challenge because I think those workers

0:17:00.200 --> 0:17:03.480
<v Speaker 5>probably get some very nice increases. If you get into

0:17:03.520 --> 0:17:07.160
<v Speaker 5>a strike, that second half recovery at Boeing is really

0:17:07.960 --> 0:17:11.040
<v Speaker 5>put into question because you can't make airplanes with your

0:17:11.119 --> 0:17:13.479
<v Speaker 5>most important union striking. And again they're going to want

0:17:13.520 --> 0:17:15.280
<v Speaker 5>some good pay raises.

0:17:15.320 --> 0:17:17.240
<v Speaker 4>All right, George, good stuff, But it's like a full

0:17:17.280 --> 0:17:20.280
<v Speaker 4>time job just figuring out what's going on with Boeing.

0:17:20.640 --> 0:17:22.280
<v Speaker 4>But boy, that's one of those companies you feel like

0:17:22.480 --> 0:17:24.720
<v Speaker 4>too big to fail in so many different ways, but

0:17:25.200 --> 0:17:27.280
<v Speaker 4>you need to really turn things around. George Ferguson he

0:17:27.320 --> 0:17:30.680
<v Speaker 4>covers all things airlines aerospace for Bloomberg Intelligence.

0:17:31.040 --> 0:17:35.560
<v Speaker 1>This is the Bloomberg Intelligence podcast, available on Apple, Spotify,

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