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In recent years, the most intense struggle between Boeing and Airbus has matched the 737 against the A320 for supremacy in the low-cost market. Over time, the A320 gradually gained the advantage because it is a newer airplane and, for various reasons, increasingly in favor with low-cost carriers. That is important, because those carriers, plus various leasing companies, are buying the new airplanes. The strapped legacy carriers are buying very little new equipment. Instead, some of them are cutting back. Well before reforming its fare structure, Delta decided to delay the delivery of 10 new Boeing aircraft and cancel options for 113 others. Some of the low-cost carriers are more austere than others. There is a spectrum of passenger comfort and services. JetBlue, with reserved seating and seats with monitors showing twenty-four channels of direct satellite TV, lies at the gentler end.
They are roughly the same size, seating up to 190 people. Both are exceptionally successful, having exceeded the most optimistic forecasts of their respective companies. The 737 is older and has been steadily improved over the years. But the A320, a newer, slightly larger, and more comfortable aircraft, is outselling the 737, not least in the low-cost market that Boeing had monopolized. In December 2004, the surge in orders for A320’s from low-cost carriers caused Boeing to shake up its sales force and replace its chief salesman, Toby Bright. The biggest revenue earners are airplanes with 200 to 300 seats. For many years, Boeing had this so-called middle market largely to itself with the 757, a long, single-aisle airplane, and the double-aisle 767. The narrower and less comfortable of the two, the 757, could seat up to 239 passengers, while the more popular 767 carries 218 to 304, depending on the version.
Airbus was scrambling to create something—ideally, a new aircraft of a size and capability close to that of the 787 but with fewer costly refinements. The stakes could hardly be higher, especially for Airbus. It had begun to take too much for granted. FOR MOST of the past twenty years, a tooth-and-claw battle for the single-aisle-airplane market has held center stage in the Airbus-Boeing saga. It set Airbus’s A320 family against Boeing’s 737’s. The success of low-cost carriers such as Southwest and JetBlue in the States, along with easyJet and others in Europe, raised the stakes. For Boeing, an especially bad patch began in 1998, when British Airways, until then an unswervingly loyal Boeing customer, decided against the 737 and instead bought fifty-nine Airbus A320 and A319 aircraft, with options for fifty-nine more. (The A319 is a slightly smaller version of the A320.)
The Virgin Way: Everything I Know About Leadership by Richard Branson
barriers to entry, call centre, carbon footprint, Celtic Tiger, clean water, collective bargaining, Costa Concordia, Donald Trump, Elon Musk, friendly fire, glass ceiling, illegal immigration, index card, inflight wifi, Lao Tzu, low cost carrier, M-Pesa, Mahatma Gandhi, Mark Zuckerberg, Northern Rock, profit motive, Ralph Waldo Emerson, Ronald Reagan, shareholder value, Silicon Valley, stem cell, Steve Jobs, Tesla Model S, trade route
Michael O’Leary, CEO of the Irish airline Ryanair, once described his ideal customer as ‘someone with a pulse and a credit card’ and in the same ‘Lunch with the Financial Times’ interview referred to the British Airports Authority as the ‘Evil Empire’ and the UK’s Civil Aviation Authority as a bunch of ‘cretins and twerps’. While nobody can question Ryanair’s incredible financial success (last time I checked the low-cost carrier had built a market cap of over $13 billion), being voted Europe’s ‘least liked’ airline by TripAdvisor subscribers is something that would not sit well with me no matter how good the bottom line looks. American property magnate Donald Trump is another controversial character who seems to be either loved or hated by the consumer and is perhaps most famous for his ‘You’re fired’ line, something he seems to delight in telling people on his TV show The Apprentice.
If you were born after 1960, Freddie’s name maybe doesn’t ring a bell as his ground-breaking Laker Airways was driven out of business in 1982, and even more sadly Freddie died in 2006 at the way-too-early age of eighty-three. A lifelong entrepreneur par excellence, Freddie was one of the greatest innovators of twentieth-century aviation and an utterly inspirational human being. Freddie invented what today we’d call a ‘low-cost carrier’ and in the process, made transatlantic air travel an affordable reality for a vast new cross-section of consumers. He was a swashbuckling hero whose larger-than-life personality, street smarts and indomitable good humour made him a standout leader in what at the time was a moribund industry desperately in need of someone to take it in a new direction. Freddie was a pragmatist; even his basic business plan for ‘Laker Skytrain’ was pure common sense.
Southeast Asia on a Shoestring Travel Guide by Lonely Planet
active transport: walking or cycling, airport security, Alfred Russel Wallace, anti-communist, British Empire, call centre, car-free, carbon footprint, clean water, clockwatching, colonial rule, Google Earth, haute cuisine, indoor plumbing, large denomination, low cost carrier, Mason jar, megacity, Skype, South China Sea, spice trade, superstar cities, sustainable-tourism, trade route, urban sprawl, women in the workforce
Tourism Malaysia (www.tourismmalaysia.gov.my) KL Sentral ( 2274 5823; 9am-6pm); Kuala Lumpur International Airport (KLIA; 8776 5651; International Arrival Hall, Sepang); Putra World Trade Centre ( 2615 8188; Level 17, 45 Jln Tun Ismail; 9am-6pm Mon-Sat) Getting There & Away Kuala Lumpur is Malaysia’s principal international arrival gateway and it forms the crossroads for domestic bus, train and taxi travel. Air For details of international airlines, Click here. Kuala Lumpur International Airport (KLIA; 8777 8888; www.klia.com.my; Pengrus Besar) is the main airport, 75km south of the city centre at Sepang. AirAsia ( 8775 4000; www.airasia.com) flights arrive and depart from the nearby Low Cost Carrier Terminal (LCCT; 8777 8888; www.lcct.com.my), while Firefly ( 03-7845 4543; www.fireflyz.com.my) and Berjaya Air ( 2145 2828; www.berjaya-air.com) flights use Sultan Abdul Aziz Shah Airport ( 7845 8382) in Subang, about 20km west of the city centre. Boat Ferries sail to Tanjung Balai on Sumatra (one way RM145, 3½ hours, 11am Monday to Saturday) in Indonesia from Pelabuhan Klang (Port Klang), accessible by KTM Komuter train from KL Sentral or by public bus (RM3.50) from Klang bus stand by Pasar Seni LRT station.
If you have more time than money, catch the Airport Coach ( 8787 3894; www.airportcoach.com.my; one way/return RM10/18) to KL Sentral (one hour); it can also take you onwards to any central KL hotel from KLIA and pick up for the return journey for a round-trip total of RM25. The bus stand is clearly signposted inside the terminal. Taxis from KLIA operate on a fixed-fare coupon system. Purchase a coupon from a counter at the arrival hall and use it to pay the driver. Standard taxis cost RM67.10. Low Cost Carrier Terminal (LCCT) Skybus (www.skybus.com.my; one-way RM9) and Aerobus (one-way RM8) depart every 15 minutes from 4.30am to 12.45am and take an hour. From LCCT, prepaid taxis charge RM62 to Chinatown or Jln Bukit Bintang (50% more from midnight to 6am). Buy your coupon at the desk near the arrivals hall exit. A taxi from the city to LCCT will cost around RM65. There’s also a shuttle bus to and from the LCCT to Salak Tinggi station where you can pick up the KL Transit Train into the city
Allow plenty of time between connecting flights if you have to switch terminals. A shuttle bus (P20; 7am-10pm) links the four terminals. * * * Air Airports & Airlines Ninoy Aquino International Airport (NAIA; Code MNL; 02-877 1109) The country’s recently upgraded flagship airport is in flux – see the boxed text below for important arrival/departure information regarding terminals. The Philippines’ primary low-cost carrier, Cebu Pacific, serves an ever-growing list of Southeast Asian cities, including Bangkok, Brunei, Jakarta, Kota Kinabalu, Kuala Lumpur, Saigon and Singapore. The other low-cost airlines flying to/from NAIA are local carrier Zest Air, Singapore’s Jetstar Asia and Tiger Airways. The country’s flagship carrier, Philippine Airlines (PAL), also serves many Southeast Asian destinations. Diosdado Macapagal International Airport (Clark Airport; code DMIA; www.clarkairport.com) Clark Airport is near Angeles, a two-hour bus ride north of downtown Manila.
Hard Landing by Thomas Petzinger, Thomas Petzinger Jr.
airline deregulation, centralized clearinghouse, collective bargaining, cross-subsidies, desegregation, Donald Trump, feminist movement, index card, low cost carrier, low skilled workers, Marshall McLuhan, means of production, mutually assured destruction, Network effects, offshore financial centre, oil shock, Ponzi scheme, postindustrial economy, price stability, profit motive, Ralph Nader, Ronald Reagan, Silicon Valley, strikebreaker, the medium is the message, The Predators' Ball, Thomas L Friedman, union organizing, yield management
Though one had to pay fifty cents for a cup of coffee on the typical People Express flight, Burr, in entering the long-haul transcontinental market, had finally added a first-class section—and the service was not horrible! Likewise, Southwest’s service, though stripped down and basic, was impeccably consistent and iridescently friendly. Crandall was concerned to learn that some businesses had begun requiring employees to travel at the lowest fare available, regardless of the level of service it required them to endure. Of all these low-cost carriers, People Express was, in early 1985, the greatest threat by far. But People Express was also perhaps the most vulnerable. Barbara Amster of the American pricing department considered People Express “the guys with the Southwest Airlines philosophy but without the brains of Southwest.” More aptly, perhaps, Don Burr and People Express had all the great ideas of Herb Kelleher and Southwest Airlines but lacked their discipline.
Crandall had not forgotten: Crandall 4/23/93 interview. 18. nearly 1,500 departures: “Revenue Control: Mining Gold at the Margin,” by Samuel M. Fuchs, Airline Executive, Jan. 1987. 19. assigned to Barbara R. Amster: Amster 4/29/93 interview. 20. had to be eradicated: Crandall 4/23/93 interview; “American on the Offensive,” Financial World, Feb. 20, 1985; “American Tries to Muscle In on the Low-Cost Carriers,” by Reggi Ann Dubin, BW, Feb. 4, 1985. 21. Crandall was concerned: Crandall remarks to 1985 Fall Planning Conference, American Airlines, draft dated Sept. 26, 1985. 22. “brains of Southwest”: Amster 4/29/93 interview. 23. “devised the fare”: Carty 4/29/93 interview. 24. new pricing strategy: “American Airlines Slashes Fares on Many Routes; Industry Stock Prices Slip as Rival Carriers Follow,” by Laurie P.
More Joel on Software by Joel Spolsky
barriers to entry, Black Swan, Build a better mousetrap, business process, call centre, Danny Hillis, failed state, Firefox, George Gilder, low cost carrier, Mars Rover, Network effects, Paul Graham, performance metric, place-making, price discrimination, prisoner's dilemma, Ray Oldenburg, Sand Hill Road, Silicon Valley, slashdot, social software, Steve Ballmer, Steve Jobs, Superbowl ad, The Great Good Place, type inference, unpaid internship, wage slave, web application, Y Combinator
They don’t want to think they’re paying extra just because they’re not clever enough to find the magic coupon code. The airline industry got really, really good at segmenting and ended up charging literally a different price to every single person on the plane. As a result, most people felt they weren’t getting the best deal, and they didn’t like the airlines. When a new alternative arose in the form of low-cost carriers (Southwest, JetBlue, etc.), customers had no loyalty whatsoever to the legacy airlines that had been trying to pick their pockets for all those years. Camels and Rubber Duckies 273 And God help you if an A-list blogger finds out that your premium printer is identical to the cheap printer, with the speed inhibitor turned off. So, while segmenting can be a useful tool to “capture consumer surplus,” it can have significant negative implications for the long-term image of your product.
The Essays of Warren Buffett: Lessons for Corporate America by Warren E. Buffett, Lawrence A. Cunningham
compound rate of return, corporate governance, Dissolution of the Soviet Union, diversified portfolio, dividend-yielding stocks, fixed income, index fund, invisible hand, large denomination, low cost carrier, oil shock, passive investing, price stability, Ronald Reagan, the market place, transaction costs, Yogi Berra, zero-coupon bond
Whatever the reason, the mistake was large. 112 CARDOZO LAW REVIEW [Vol. 19:1 Before this purchase, I simply failed to focus on the problems that would inevitably beset a carrier whose costs were both high and extremely difficult to lower. In earlier years, these life-threatening costs posed few problems. Airlines were then protected from competition by regulation, and carriers could absorb high costs because they could pass them along by way of fares that were also high. When deregulation came along, it did not immediately change the picture: The capacity of low-cost carriers was so small that the high-cost lines could, in large part, maintain their existing fare structures. During this period, with the longer-term problems largely invisible but slowly metastasizing, the costs that were nonsustainable became further embedded. As the seat capacity of the low-cost operators expanded, their fares began to force the old-line, high-cost airlines to cut their own. The day of reckoning for these airlines could be delayed by infusions of capital (such as ours into USAir), but eventually a fundamental rule of economics prevailed: In an unregulated commodity business, a company must lower its costs to competitive levels or face extinction.
airline deregulation, airport security, Atul Gawande, call centre, Captain Sullenberger Hudson, collective bargaining, inflight wifi, low cost carrier, Maui Hawaii, Mercator projection, New Urbanism, pattern recognition, race to the bottom, Skype, Tenerife airport disaster
Between 2001 and 2012, United, Delta, Northwest, American, and US Airways all declared bankruptcy—the latter twice. Losses were in the billions, layoffs in the tens of thousands. For the most part, that bleeding has stopped, but while the entrenched old-timers were left to shed costs, reshape their business models, and return to profitability—a decade-long process that ultimately resulted in three mega-mergers—opportunistic low-cost carriers (LCCs) like jetBlue, Southwest, Spirit, and AirTran seized the opportunity. Unencumbered by high labor costs or the need to support complex fleets and decades-old infrastructures, these adaptable youngsters were able to offer streamlined service and irresistibly cheap tickets, rapidly winning over a huge segment of the domestic U.S. market. The proliferation of the LCC, more than any other factor, has radically transformed the competitive dynamic.
Frugal Innovation: How to Do Better With Less by Jaideep Prabhu Navi Radjou
3D printing, additive manufacturing, Affordable Care Act / Obamacare, Airbnb, Albert Einstein, barriers to entry, Baxter: Rethink Robotics, Bretton Woods, business climate, business process, call centre, Capital in the Twenty-First Century by Thomas Piketty, carbon footprint, cloud computing, collaborative consumption, collaborative economy, connected car, corporate social responsibility, crowdsourcing, Elon Musk, financial innovation, global supply chain, income inequality, industrial robot, Internet of things, job satisfaction, Khan Academy, Kickstarter, late fees, Lean Startup, low cost carrier, M-Pesa, Mahatma Gandhi, megacity, minimum viable product, more computing power than Apollo, new economy, payday loans, peer-to-peer lending, Peter H. Diamandis: Planetary Resources, precision agriculture, race to the bottom, reshoring, ride hailing / ride sharing, risk tolerance, Ronald Coase, self-driving car, shareholder value, sharing economy, Silicon Valley, Silicon Valley startup, six sigma, smart grid, smart meter, software as a service, Steve Jobs, supply-chain management, TaskRabbit, The Fortune at the Bottom of the Pyramid, The Nature of the Firm, transaction costs, unbanked and underbanked, underbanked, women in the workforce, X Prize, yield management, Zipcar
Such business models include: software as a service (SaaS) in computing; power by the hour in aircraft engines; massive open online courses (MOOCs) in education; hub-and-spoke and yield management models in airlines; online retailing; and cloud computing. By flexing their assets, airlines such as Southwest Airlines, easyJet and Ryanair have created a new, low-cost market segment for flyers within the US and Europe, and have succeeded in challenging long-haul incumbents. First, the low-cost carriers rebased the existing airline business model by maximising the time that their most valuable assets – their aircraft – spend in the air, and reducing the time they spend on the ground. Second, they use a hub-and-spoke model that maximises reach while minimising the typical journey distance. Third, they use new digital technology to understand, anticipate and influence consumer behaviour and ticket pricing to squeeze as much revenue as possible from their main, perishable resource: seats on flights.
Affordable Care Act / Obamacare, asset-backed security, bank run, banking crisis, Basel III, Bernie Madoff, Big bang: deregulation of the City of London, bitcoin, Black Swan, Bonfire of the Vanities, bonus culture, Bretton Woods, call centre, capital asset pricing model, Capital in the Twenty-First Century by Thomas Piketty, cognitive dissonance, corporate governance, Credit Default Swap, cross-subsidies, dematerialisation, diversification, diversified portfolio, Edward Lloyd's coffeehouse, Elon Musk, Eugene Fama: efficient market hypothesis, eurozone crisis, financial innovation, financial intermediation, fixed income, Flash crash, forward guidance, Fractional reserve banking, full employment, George Akerlof, German hyperinflation, Goldman Sachs: Vampire Squid, Growth in a Time of Debt, income inequality, index fund, inflation targeting, interest rate derivative, interest rate swap, invention of the wheel, Irish property bubble, Isaac Newton, London Whale, Long Term Capital Management, loose coupling, low cost carrier, M-Pesa, market design, millennium bug, mittelstand, moral hazard, mortgage debt, new economy, Nick Leeson, Northern Rock, obamacare, Occupy movement, offshore financial centre, oil shock, passive investing, peer-to-peer lending, performance metric, Peter Thiel, Piper Alpha, Ponzi scheme, price mechanism, purchasing power parity, quantitative easing, quantitative trading / quantitative ﬁnance, railway mania, Ralph Waldo Emerson, random walk, regulatory arbitrage, Renaissance Technologies, rent control, Richard Feynman, risk tolerance, road to serfdom, Robert Shiller, Robert Shiller, Ronald Reagan, Schrödinger's Cat, shareholder value, Silicon Valley, Simon Kuznets, South Sea Bubble, sovereign wealth fund, Spread Networks laid a new fibre optics cable between New York and Chicago, Steve Jobs, Steve Wozniak, The Great Moderation, The Market for Lemons, the market place, The Myth of the Rational Market, the payments system, The Wealth of Nations by Adam Smith, The Wisdom of Crowds, Tobin tax, too big to fail, transaction costs, tulip mania, Upton Sinclair, Vanguard fund, Washington Consensus, We are the 99%, Yom Kippur War
One side asserted the process was a racket operated for the benefit of large corporations, the other that consumers would be better served by the operation of a free market. There was substantial truth in both claims. A regulatory historian, Alfred Kahn, was appointed chairman of the Civil Aeronautics Board, where he accomplished the unusual feat of winding up the agency he headed. Rapid growth of low-cost carriers followed, first in the USA and then in other parts of the world. Many of the established firms, such as Pan Am and TWA, failed, but some successfully adjusted to the competitive environment, and new entrants came – and often went. Airline regulation today is focused narrowly on safety and related issues, and the industry has developed what is known as a ‘just culture’, which encourages an openness about failures and a combination of collective responsibility for integrity and competitive responsibility for service.20 The concept of ‘just culture’ is now gaining traction in other areas of commercial activity of public concern, such as medicine.
Connectography: Mapping the Future of Global Civilization by Parag Khanna
1919 Motor Transport Corps convoy, 2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, 9 dash line, additive manufacturing, Admiral Zheng, affirmative action, agricultural Revolution, Airbnb, Albert Einstein, amateurs talk tactics, professionals talk logistics, Amazon Mechanical Turk, Asian financial crisis, asset allocation, autonomous vehicles, banking crisis, Basel III, Berlin Wall, bitcoin, Black Swan, blockchain, borderless world, Boycotts of Israel, Branko Milanovic, BRICs, British Empire, business intelligence, call centre, capital controls, charter city, clean water, cloud computing, collateralized debt obligation, complexity theory, corporate governance, corporate social responsibility, credit crunch, crony capitalism, crowdsourcing, cryptocurrency, cuban missile crisis, data is the new oil, David Ricardo: comparative advantage, deglobalization, deindustrialization, dematerialisation, Deng Xiaoping, Detroit bankruptcy, diversification, Doha Development Round, edge city, Edward Snowden, Elon Musk, energy security, ethereum blockchain, European colonialism, eurozone crisis, failed state, Fall of the Berlin Wall, family office, Ferguson, Missouri, financial innovation, financial repression, forward guidance, global supply chain, global value chain, global village, Google Earth, Hernando de Soto, high net worth, Hyperloop, ice-free Arctic, if you build it, they will come, illegal immigration, income inequality, income per capita, industrial robot, informal economy, Infrastructure as a Service, interest rate swap, Internet of things, Isaac Newton, Jane Jacobs, Jaron Lanier, John von Neumann, Julian Assange, Just-in-time delivery, Kevin Kelly, Khyber Pass, Kibera, Kickstarter, labour market flexibility, labour mobility, LNG terminal, low cost carrier, manufacturing employment, mass affluent, megacity, Mercator projection, microcredit, mittelstand, Monroe Doctrine, mutually assured destruction, New Economic Geography, new economy, New Urbanism, offshore financial centre, oil rush, oil shale / tar sands, oil shock, openstreetmap, out of africa, Panamax, Peace of Westphalia, peak oil, Peter Thiel, Plutocrats, plutocrats, post-oil, post-Panamax, private military company, purchasing power parity, QWERTY keyboard, race to the bottom, Rana Plaza, rent-seeking, reserve currency, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Coase, Scramble for Africa, Second Machine Age, sharing economy, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, six sigma, Skype, smart cities, Smart Cities: Big Data, Civic Hackers, and the Quest for a New Utopia, South China Sea, South Sea Bubble, sovereign wealth fund, special economic zone, spice trade, Stuxnet, supply-chain management, sustainable-tourism, TaskRabbit, telepresence, the built environment, Tim Cook: Apple, trade route, transaction costs, UNCLOS, uranium enrichment, urban planning, urban sprawl, WikiLeaks, young professional, zero day
As the first power to engage when Myanmar’s border trade was legalized in the 1980s, China has capitalized on what is a centuries-old history of Sino-Burmese seasonal migration, especially in provinces such as Shan State where China and Myanmar blur together. Chinese companies operate mines in Shan, pipelines cross through it, the yuan can be used as currency there, and mixed marriages are rising.*6 Carving through Southeast Asia is no longer about borders but about the management of flows and frictions. ASEAN’s businesspeople, workers, students, and tourists now ferry across the region in record numbers on the back of low-cost carriers such as AirAsia, which has done as much for regional integration as any diplomatic body. Demographic shifts guarantee that Asia’s blending will continue: The erstwhile “Asian Tigers” such as Singapore and Taiwan—to say nothing of much larger China and Japan—are aging, while Indonesia and the Philippines are full of youthful labor. Over 250,000 Burmese live in Thailand alone, without which the micro-economy would grind to a halt just as many American cities and towns would without Mexicans.
Age of Discovery: Navigating the Risks and Rewards of Our New Renaissance by Ian Goldin, Chris Kutarna
2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, Airbnb, Albert Einstein, AltaVista, Asian financial crisis, asset-backed security, autonomous vehicles, banking crisis, barriers to entry, battle of ideas, Berlin Wall, bioinformatics, bitcoin, Bonfire of the Vanities, clean water, collective bargaining, Colonization of Mars, Credit Default Swap, crowdsourcing, cryptocurrency, Dava Sobel, demographic dividend, Deng Xiaoping, Doha Development Round, double helix, Edward Snowden, Elon Musk, en.wikipedia.org, epigenetics, experimental economics, failed state, Fall of the Berlin Wall, financial innovation, full employment, Galaxy Zoo, global supply chain, Hyperloop, immigration reform, income inequality, indoor plumbing, industrial robot, information retrieval, intermodal, Internet of things, invention of the printing press, Isaac Newton, Islamic Golden Age, Khan Academy, Kickstarter, labour market flexibility, low cost carrier, low skilled workers, Lyft, Malacca Straits, megacity, Mikhail Gorbachev, moral hazard, Network effects, New Urbanism, non-tariff barriers, Occupy movement, On the Revolutions of the Heavenly Spheres, open economy, Panamax, personalized medicine, Peter Thiel, post-Panamax, profit motive, rent-seeking, reshoring, Robert Gordon, Search for Extraterrestrial Intelligence, Second Machine Age, self-driving car, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Skype, smart grid, Snapchat, special economic zone, spice trade, statistical model, Stephen Hawking, Steve Jobs, Stuxnet, TaskRabbit, too big to fail, trade liberalization, trade route, transaction costs, transatlantic slave trade, uranium enrichment, We are the 99%, We wanted flying cars, instead we got 140 characters, working poor, working-age population, zero day
Between 1990 and 2014, the worldwide total of international tourist arrivals (defined as visits of at least one night) rose from 440 million to 1.4 billion visits, with China now the biggest source of travelers.36 Air traffic presents similarly stark evidence. Total passenger trips have leapt from some 500 million in 1990 to over 3.2 billion in 2014.37 And since 2011, international flights have outnumbered domestic.38 Many factors have driven this growth. One is the invention of low-cost carriers (Southwest Airlines, EasyJet, RyanAir, Peach and others) in North America, Europe and Asia, which broadened considerably the community of airborne commuters. But the bigger factor is the emergence of new hubs on the once-margins of the world, plugging those populations into the global circulation of jet-setters. Their emergence is plain to see in rankings of the world’s busiest airports.
Who Stole the American Dream? by Hedrick Smith
Affordable Care Act / Obamacare, airline deregulation, anti-communist, asset allocation, banking crisis, Bonfire of the Vanities, British Empire, business process, clean water, cloud computing, collateralized debt obligation, collective bargaining, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, David Brooks, Deng Xiaoping, desegregation, Double Irish / Dutch Sandwich, family office, full employment, global supply chain, Gordon Gekko, guest worker program, hiring and firing, housing crisis, Howard Zinn, income inequality, index fund, informal economy, invisible hand, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, knowledge worker, laissez-faire capitalism, late fees, Long Term Capital Management, low cost carrier, manufacturing employment, market fundamentalism, Maui Hawaii, mortgage debt, new economy, Occupy movement, Own Your Own Home, Peter Thiel, Plutonomy: Buying Luxury, Explaining Global Imbalances, Ponzi scheme, Ralph Nader, RAND corporation, Renaissance Technologies, reshoring, rising living standards, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, shareholder value, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Steve Jobs, The Chicago School, The Spirit Level, too big to fail, transaction costs, transcontinental railway, union organizing, Unsafe at Any Speed, Vanguard fund, We are the 99%, women in the workforce, working poor, Y2K
It came out to something between 45 and 60 percent of their final pay. Pat O’Neill, who ended up making $50,000 plus, could count on an annual retirement of roughly $36,000, or about $3,000 a month—for the rest of his life. United Airlines was committed to that under its union contracts and the 1974 Employee Retirement Income Security Act (ERISA). Bankrupt Promises The crunch began in the 1990s. Low-cost carriers like Southwest Airlines began eating into United’s market share, and its profit margins slipped. In 1994, United’s finances were so shaky that management struck a grand bargain with its unions—management would trade 55 percent majority ownership in the company to its unions in exchange for their agreeing to $4.9 billion in pay cuts and reduced benefits. Union members could buy company stock.
Security Analysis by Benjamin Graham, David Dodd
asset-backed security, backtesting, barriers to entry, capital asset pricing model, carried interest, collateralized debt obligation, collective bargaining, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, diversification, diversified portfolio, fear of failure, financial innovation, fixed income, full employment, index fund, invisible hand, Joseph Schumpeter, locking in a profit, Long Term Capital Management, low cost carrier, moral hazard, mortgage debt, p-value, risk-adjusted returns, risk/return, secular stagnation, shareholder value, The Chicago School, the market place, the scientific method, The Wealth of Nations by Adam Smith, transaction costs, zero-coupon bond
We paid 16 times the current year’s earnings estimates and felt this price was justified by Ryanair’s huge cost advantages and growth prospects. Then the price of oil doubled again. The shares have declined 30% since our initial investment, and the profit outlook has dimmed. Still, the business franchise is intact. Nothing has happened that makes us believe the long-term value of our investment has diminished. In fact, during this period of adversity, other low-cost carriers are expected to cease operations. Lenders are likely to be cautious in funding possible new entrants, and consumers may wish to trade down to take advantage of Ryanair’s low fares. Over time, a company with this kind of cost advantage must take market share and earn attractive returns. The process I have just described is our attempt to cover the bases outlined by the authors of Security Analysis.
France (Lonely Planet, 8th Edition) by Nicola Williams
active transport: walking or cycling, back-to-the-land, bike sharing scheme, British Empire, car-free, carbon footprint, centre right, Columbine, double helix, Guggenheim Bilbao, haute couture, haute cuisine, Henri Poincaré, Honoré de Balzac, illegal immigration, industrial robot, information trail, Jacquard loom, Jacquard loom, Joseph-Marie Jacquard, Louis Blériot, Louis Pasteur, low cost carrier, Mahatma Gandhi, means of production, Murano, Venice glass, pension reform, QWERTY keyboard, ride hailing / ride sharing, Saturday Night Live, Silicon Valley, Skype, supervolcano, trade route, urban renewal, urban sprawl, V2 rocket
For the best quality, visit a specialist shop, such as Pierre Ibaïalde ( 05 59 25 65 30; 41 rue des Cordeliers), where you can taste before you buy. See the boxed text for shops selling the town’s other gastronomic claim to fame, chocolate. Getting There & Away AIR Biarritz-Anglet-Bayonne airport ( 05 59 43 83 83; www.biarritz.aeroport.fr) is 5km southwest of central Bayonne and 3km southeast of the centre of Biarritz. It’s served by low-cost carriers including easyJet and Ryanair, as well as Air France, with daily domestic flights and flights to the UK, and regular flights to Ireland and other European destinations. Bus 6 links both Bayonne and Biarritz with the airport (buses depart roughly hourly). A taxi from the town centre costs around €15 to €20. BUS From place des Basques, ATCRB buses ( 05 59 26 06 99) follow the coast to the Spanish border.
Lonely Planet France by Lonely Planet Publications
banking crisis, bike sharing scheme, British Empire, car-free, carbon footprint, centre right, Columbine, double helix, Frank Gehry, glass ceiling, haute couture, haute cuisine, Henri Poincaré, Honoré de Balzac, illegal immigration, Jacquard loom, Jacquard loom, Joseph-Marie Jacquard, Louis Blériot, Louis Pasteur, low cost carrier, Mahatma Gandhi, Murano, Venice glass, ride hailing / ride sharing, sensible shoes, Silicon Valley, supervolcano, trade route, urban renewal, urban sprawl, V2 rocket
Information Tourist office ( 08 20 42 64 64; www.bayonne-tourisme.com; place des Basques; 9am-7pm Mon-Sat, 10am-1pm Sun) Efficient office providing stacks of informative brochures and free bike rental, plus guided city tours. Getting There & Away Air Biarritz-Anglet-Bayonne airport ( 05 59 43 83 83; www.biarritz.aeroport.fr) is 5km southwest of central Bayonne and 3km southeast of the centre of Biarritz. It’s served by low-cost carriers including EasyJet and Ryanair, as well as Air France, with daily domestic flights and flights to the UK, and regular flights to Ireland, Finland, Switzerland and the Netherlands. Bus From place des Basques, ATCRB (www.transdev-atcrb.com) buses follow the coast to the Spanish border. There are nine services daily to St-Jean de Luz (€3, 40 minutes) and Hendaye (€3, one hour). Summer beach traffic can double journey times.