Bloomberg Surveillance
Bloomberg Surveillance: Underweight Treasuries
Dec 4, 2023
Peter Tchir wants to be underweight Treasuries. George Saravelos says the ECB should cut rates. Ajay Banga discusses climate finance and the role of the private sector. David Turk talks about the negative effects of new bank capital rules. Helane Becker weighs in on the Alaskan Airlines and Hawaiian Airlines merger. Investment ideas for 2023 and 2024 focus on Delta Airlines.
33:50
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Quick takeaways
- The merger between Alaska Airlines and Hawaiian Airlines aims to strengthen their positions in the airline industry by providing financial stability and cross-geographic operations, allowing them to weather the challenges faced during the pandemic.
- The consolidation in the airline industry, including the Alaska-Hawaiian merger and the ongoing evaluation of the JetBlue-Spirit merger, highlights the trend of airlines seeking to create complementary businesses with moderate market shares, ultimately benefiting their operational efficiency and future growth in the competitive landscape.
Deep dives
Consolidation of Alaska and Hawaiian Airlines
Alaska Airlines and Hawaiian Airlines announced a merger that aims to strengthen their positions in the airline industry. The consolidation is expected to benefit both airlines, particularly in terms of cross-geographic operations, such as flights between mainland US and Hawaii. The merger will also provide financial stability to the airlines, allowing them to weather the challenges faced during the pandemic. With only 12 overlapping routes, the consolidation is not expected to significantly affect competition. The combined airline will have over 300 aircraft and generate around $13-14 billion in revenue.
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