Business

Boeing’s looks to fly past its old controversies with new CEO

Need to make your company profitable? Fire your CEO. Kelly Ortberg, an aerospace veteran, now has the reins of Boeing. He will be trusted with putting the company back on its feet after a months long search for a new CEO.

Boeing hasn’t had a good run as of late. Manufacturing and quality issues, a massive regulatory battle, production slowdowns, and a plummeting share price have plagued the world’s largest airline. Ortberg thinks he can fix it.

Looking for a win

While the news of Ortberg’s hiring pushed Boeing’s stock up a few points, there’s a big financial hole yet to fill:

• The company reported finishing the second quarter of this year with a $1.14 billion loss.

  • This is just a bit worse (sarcasm) than its $149 million loss the same time last year.

• The airline reported a 15% decline in revenue last quarter.

• Since 2020, Boeing has lost close to $25 billion.

On top of a plethora of other issues, especially regulatory problems stemming from the doorplug incident in January and the aviation industry’s shortage of planes, the company had even more bad news to report:

• Last quarter, Boeing reported a 32% decline in plane shipments.

• Boeing executives estimated that business expenses will pile up to at least $1 billion per month for (at bare minimum) the rest of the quarter.

• If that isn’t enough, a delayed Air Force One defense plan and fixed-price contracts are siphoning even more money from the airline.

Suffice to say, Boeing has its hands full… Ortberg is hoping to bring much needed experience (as his predecessor didn’t have any) and a different point of view so Boeing can tackle its productions issues by the end of 2024.

Fun fact: Boeing had previously required all employees, including executives, to retire at age 65, but removed the mandate so 64-year-old Ortberg could join the company.

Economy

Will this finally get the Fed to lower rates?

At this point, I think it would take an apocalyptic event. All eyes are on Fed chair Jerome Powell after a lackluster jobs report and rising unemployment have everyone looking for the Fed to cut interest rates.

This comes as Wall Street and markets around the world suffered huge losses, and a global selloff resulting in over $2 trillion being wiped out from stocks after fears mount of a slowing US economy.

Report card

If the most recent jobs report could be given a typical school grade, it wouldn’t be much higher than a big ole’ fat F.

• After job growth last month almost stagnated, the labor industry only added 114,000 jobs, over 70,000 less than economists expected.

• Economic pundits also noted that unemployment increased to 4.3% (a three-year high), which triggered an indicator known as the Sahm rule that supposedly signals when a recession is on the horizon.

However, the rule’s namesake, economist Claudia Sahm, stated that recent unique factors have affected the data, and the economy is not going to enter a recession.

Meager markets

Sahm’s statement comes as the S&P and Nasdaq plunged (3% and 3.4%, respectively) at the start of regular trading on Monday, as a global selloff resulted in $2 trillion being wiped out from stocks after last week’s lackluster jobs report.

Wall Street and markets around the world suffered mammoth losses as fears increasingly gather of a weakening US economy:

• The “Magnificent Seven” stocks, which include Apple, Nvidia, and Tesla, posted a record drop.

• Japanese stocks suffered their worst crash since 1987, plunging 12.4%.

• The DOW Jones dropped 1,000 points.

Amid the financial chaos, Wall Street’s most prominent bears are reiterating economic warnings about the risks of a further slowdown and traders are discussing an emergency rate-cut from the Fed.

Technology

Do we really need a robot friend?

The world’s brightest minds have now developed a necklace that will let you know that no one wants to try your IPA. The new AI jewelry from Friend will listen in on all of your conversations and text you accordingly. Just what the human race needed.

The accessory was unveiled this week with an advertisement that quickly went viral online, where the main sentiment was that it's pretty stupid (just look at the posts replies).

How does it work?

Friend basically just has an always-on microphone and uses its own app (which is free at the moment) to message you supportive or lightheartedly insulting texts based on what it overhears.

• At friend.com, the company is accepting preorders for $99 each.

  • Avi Schiffmann, the creator, claims to have paid $1.8 million to get the domain.

• The company claims the device doesn't store audio recordings.

Friend, according to Schiffmann, isn’t like other AI wearables, after a market full of disastrous products like the Rabbit R1 and Humane's AI pin failed to produce any results.

Grab Bag

SUVs and Trucks are out

In the land where trucks are as American as a burger, they still can’t find a way to beat a compact car. Smaller, more cost-friendly cars are driving the car market in 2024, seeing an increase in sales and outpacing their larger counterparts, data from Cox Automotive indicates.

With car prices soaring and high borrowing rates, buyers are opting for more budget-friendly options while avoiding SUVs and pickup trucks, which have traditionally led the market.

What does the data say?

While the car industry has only seen a 2% rise in vehicle sales this year, the numbers still point to a small car craze:

• Sales of compact cars have shot up 18%.

  • The Nissan Sentra (+55%), Honda Civic (+38%), and Toyota Corolla (+26%) are among the top-selling cars this year, showing the interest for smaller vehicles.

• Sales of compact SUVs also grew 12%.

  • With sales up 230% from the first half of last year, the Chevy Trax (a compact SUV) is one of the biggest sellers of the year.

Comparatively, full-size pickup trucks are on the decline, seeing a 4% drop in sales this year.

They’ve stepped up their game: From 2021 to 2024, the cost of cars have skyrocketed around 20%, and modern compact cars are more spacious than before and frequently include safety features and conventional amenities that appeal to the luxurious preferences of consumers.

• Most compact cars and SUVs are under $30,000, so the increase in quality and convenience features provides a strong case for lower-cost buyers.

• Plus, the average cost of a pickup truck typically hovers around double the price of compact cars and SUVs.

That doesn’t mean trucks are gone, though… Pickup trucks with flatbeds, such as the Ford F-Series, Chevy Silverado, and Ram pickup, were still the top three selling automobiles in America last year.

Say goodbye to prolonged blood draws

So you’re telling me I don’t have to have an old lady stick me with a needle? Say less. The health industry might just be on the verge of revamping how we take blood tests, with an eerily similar product to Elizabeth Holmes’ Theranos.

What’s Theranos?

With just one drop of blood, Theranos claimed to have discovered a means to perform hundreds of medical tests with its ‘Edison machine’, removing the requirement for uncomfortable, time-consuming, and arm-fed blood draws.

But now, half a decade after Theranos closed up, a few startups have succeeded in creating the cutting-edge technology, as reported by the Wall Street Journal.

Lasting hope

Despite the Theranos debacle, there is persistent hope that a straightforward, dependable, and comparatively painless blood testing procedure is feasible.

The Texas-based company, Babson Diagnostics, claimed its finger prick draws are medically the same as intravenous blood tests, after conducting preliminary clinical studies.

• The machine designed by Babson is capable of examining blood acquired by another startup, Becton Dickenson’s, finger prick device.

It uses a fraction of the blood needed for a typical venous collection to perform the usual tests that you would get at a healthcare provider, and might just bring us a (hopefully) more successful version of what Theranos offered.

Fast Facts

Snoop Salary: Snoop Dogg is reportedly being paid $500,000 per day (plus all expenses paid) to be in Paris promoting the Olympics. Can someone please send me an application.

Taco Tech: Taco Bell plans to expand AI voice technology in drive-thrus to hundreds of its locations this year. 

Moonwalk: The astronauts stuck in space due to a problem with Boeing’s Strarliner rocket may need to be be brought back to Earth in a SpaceX rocket, NASA said.

Carry-on Coke: Ecuadorian police found 6.23 metric tons of cocaine in a banana shipment set to be delivered to Germany.

Big Bonus: You may not know, but many countries give out bonuses if you win an Olympic medal. Kazakhstan gifts a $250,000 bonus and a house if you win gold, while Hong Kong pays $768,000 (the most out of any country), and Indonesia a cow.