Dear readers,
I am sorry that I will be busy for this coming week. I have lots of things to do at work for now. I will try my best to come up some stuff to talk about. Just hold on and wait till next week. Seeya soon. Feel free to send me message. Cheers!
Yours truly,
Ronnie
Saturday, February 28, 2009
Saturday, February 21, 2009
Massive Drops In The Airline Industry
The Complexities of Airline Industry Will Never Be The Same
Airline Industry will never be the same as the oil supply remains relatively low and the recent global recession continues. As the oil production decreases, the price of oil will start to increase again, which ultimately also raises the cost of flying. However, it will only happen in a long run. What the market faces is another challenge of recession and consumerism.
Since recession has already arrived, the Airline market will have to face several consequences due to the change in income level. Income level, in general, will shrink as business retrenchment proceeds globally. As a result, a change in preference reflects the airline market. Anyway, traveling can be identified as a luxurious good or a normal good or both. However, in an airline industry, airline companies usually distinguish themselves in 3 categories: budget airline, normal airline and luxurious airline. Of course, one can see a main company with a sub company, operating at a lower cost. They want to capture as much market demand as possible with the benefit of market (price) controlling. Airline industry is definitely a competitive market in a global scale. Some companies have certain advantages over others. The main focus of this post is on the results and changes in the airline industry as they encounter the problem of global recession.
Budget airlines will likely to be on a safe side during this period of global recession. On the other hand, normal airlines will suffer from a decrease in demand due to the shrinkage of disposable income or income level. In other words, it’s more like a normal good. When the economy is hit, travelers will cut back on expensive vacations and search for cheaper alternatives by flying on a low-cost budget airline. For example, 20% of the population takes luxurious airlines, 40% takes normal airlines and 40% takes budget airlines. As the income
level shrinks, middle-income earners will most likely to be affected very much due to their exposures to investments. Assume, middle-income earners (40%) and low-income earners (40%) are affected by a decrease in 10% in their incomes. Certainly, middle-income earners will lose a big chunk, compared to low-income earners. How will that affect the airline industry? A 10% reduction in low-income earners’ income does not reflect much on their travels with budget airlines. Even if it does, middle-income earners will start to switch with traveling on budget airlines because now they lose a big chunk of their income. Middle-income earners might lose 4000(10%) = 400. Low-income earners might lose 2000(10%) = 200. Importantly, budget airline market will still benefit in many ways: low-income earners have no choice but to travel with budget airlines, new potential market of middle-income earners is switching to other cheaper alternatives, and a reduction in income level might not influence that much to the budget airline market. Suddenly, one can see a reduction in customers taking normal airlines. To ensure the flight route is viable for profits, “normal” airline companies are starting to cut down certain flights or decreasing the numbers of flights. Some companies might have to resolve in employees lay off.
For extra information on graphical explanations or any comments, feel free to ask me.
Airline Industry will never be the same as the oil supply remains relatively low and the recent global recession continues. As the oil production decreases, the price of oil will start to increase again, which ultimately also raises the cost of flying. However, it will only happen in a long run. What the market faces is another challenge of recession and consumerism.
Since recession has already arrived, the Airline market will have to face several consequences due to the change in income level. Income level, in general, will shrink as business retrenchment proceeds globally. As a result, a change in preference reflects the airline market. Anyway, traveling can be identified as a luxurious good or a normal good or both. However, in an airline industry, airline companies usually distinguish themselves in 3 categories: budget airline, normal airline and luxurious airline. Of course, one can see a main company with a sub company, operating at a lower cost. They want to capture as much market demand as possible with the benefit of market (price) controlling. Airline industry is definitely a competitive market in a global scale. Some companies have certain advantages over others. The main focus of this post is on the results and changes in the airline industry as they encounter the problem of global recession.
Budget airlines will likely to be on a safe side during this period of global recession. On the other hand, normal airlines will suffer from a decrease in demand due to the shrinkage of disposable income or income level. In other words, it’s more like a normal good. When the economy is hit, travelers will cut back on expensive vacations and search for cheaper alternatives by flying on a low-cost budget airline. For example, 20% of the population takes luxurious airlines, 40% takes normal airlines and 40% takes budget airlines. As the income
level shrinks, middle-income earners will most likely to be affected very much due to their exposures to investments. Assume, middle-income earners (40%) and low-income earners (40%) are affected by a decrease in 10% in their incomes. Certainly, middle-income earners will lose a big chunk, compared to low-income earners. How will that affect the airline industry? A 10% reduction in low-income earners’ income does not reflect much on their travels with budget airlines. Even if it does, middle-income earners will start to switch with traveling on budget airlines because now they lose a big chunk of their income. Middle-income earners might lose 4000(10%) = 400. Low-income earners might lose 2000(10%) = 200. Importantly, budget airline market will still benefit in many ways: low-income earners have no choice but to travel with budget airlines, new potential market of middle-income earners is switching to other cheaper alternatives, and a reduction in income level might not influence that much to the budget airline market. Suddenly, one can see a reduction in customers taking normal airlines. To ensure the flight route is viable for profits, “normal” airline companies are starting to cut down certain flights or decreasing the numbers of flights. Some companies might have to resolve in employees lay off.For extra information on graphical explanations or any comments, feel free to ask me.
Wednesday, February 18, 2009
Thank You Freaky Readers
Dear Readers,
Thank you so much for supporting my blog. I feel something strange about this blog. Somehow, i think readers feel a little tired of reading my blog because it's getting boring or what. Anyway, today my blog has reached a thousand entries. It's brilliant. In order to be effective in my blogging, I definitely would like to have some of your comments about things that can be done to juice up the blog. Feel free to email me or message me here. As far as I am concerned, I have planned something cool for this year. Once again, thank you very much. Please do feel free to participate in my blog. Give me some comments. We need more discussion here. Cheers
Yours truly,
Ronnie
Thank you so much for supporting my blog. I feel something strange about this blog. Somehow, i think readers feel a little tired of reading my blog because it's getting boring or what. Anyway, today my blog has reached a thousand entries. It's brilliant. In order to be effective in my blogging, I definitely would like to have some of your comments about things that can be done to juice up the blog. Feel free to email me or message me here. As far as I am concerned, I have planned something cool for this year. Once again, thank you very much. Please do feel free to participate in my blog. Give me some comments. We need more discussion here. Cheers
Yours truly,
Ronnie
Tuesday, February 17, 2009
StiMuluS PlaN
Wh@t A fre@ky StiMuluS Pl@n?
The global economy is in tremendous pressure of economic downfall, which is badly affected by the credit crisis in the States. Recession is everywhere. Most developed countries are in considerable danger of high unemployment rate and other social implications. Multinational companies are retracting their outputs and inputs in terms of production throughout the world. What can be done to recover the global over- speculation economy? Governments, from different parts of the world, are implementing stimulus plans to sustain the multiple effects of global recession. They are trying to create jobs for the “unemployed work force. Hoping that job creations can create multiple effects in the local economy, governments are doing their best in injecting lots of money in terms of building infrastructures and giving out social benefits to the unfortunate.
The huge amount of money injection to the economy is a way to smoothen out the pain of economic crisis, but not necessarily fixing the economic system. When the government mentions about stimulus plan, they are talking about injecting money to the economy, money that belongs to the society. However, consumers and private companies have some sort of bad speculation over the economy. In other words, the previous market economy was over speculated and now it has to be retracted to
a certain state of stable economic equilibrium. What we see here is that the government is trying to offset the economic breakdown but how far will they manage to do so. Coming back to my question, does stimulus plan help? It really depends how one would look at it. The economic crisis is not about injecting stimulus plans when there are still multiple holes of broken systems. It’s no point of filling a tank with water when the tank has leakages. These leakages can be inefficient financial system, corruption, loopholes, uncertainties of investment and misjudgment.
I believe that the new stimulus plan not only should focus on money injection but also a new working system that will ultimately bring us to a higher standard of stable economic equilibrium. For now, governments are spending our money and yet we are retracting. This is something I would call the “see-saw” economy. The economy needs trust and efficient financial systems from consumers and private companies. If the economy continues to dampen, maybe it’s true that the economy is over speculated and we are still far away of reaching a higher standard of global economic equilibrium. As far as we concerned, the American financial systems are in total mess. The global economic system needs to be changed. Policymakers! Good Luck!
The global economy is in tremendous pressure of economic downfall, which is badly affected by the credit crisis in the States. Recession is everywhere. Most developed countries are in considerable danger of high unemployment rate and other social implications. Multinational companies are retracting their outputs and inputs in terms of production throughout the world. What can be done to recover the global over- speculation economy? Governments, from different parts of the world, are implementing stimulus plans to sustain the multiple effects of global recession. They are trying to create jobs for the “unemployed work force. Hoping that job creations can create multiple effects in the local economy, governments are doing their best in injecting lots of money in terms of building infrastructures and giving out social benefits to the unfortunate.
The huge amount of money injection to the economy is a way to smoothen out the pain of economic crisis, but not necessarily fixing the economic system. When the government mentions about stimulus plan, they are talking about injecting money to the economy, money that belongs to the society. However, consumers and private companies have some sort of bad speculation over the economy. In other words, the previous market economy was over speculated and now it has to be retracted to
a certain state of stable economic equilibrium. What we see here is that the government is trying to offset the economic breakdown but how far will they manage to do so. Coming back to my question, does stimulus plan help? It really depends how one would look at it. The economic crisis is not about injecting stimulus plans when there are still multiple holes of broken systems. It’s no point of filling a tank with water when the tank has leakages. These leakages can be inefficient financial system, corruption, loopholes, uncertainties of investment and misjudgment.I believe that the new stimulus plan not only should focus on money injection but also a new working system that will ultimately bring us to a higher standard of stable economic equilibrium. For now, governments are spending our money and yet we are retracting. This is something I would call the “see-saw” economy. The economy needs trust and efficient financial systems from consumers and private companies. If the economy continues to dampen, maybe it’s true that the economy is over speculated and we are still far away of reaching a higher standard of global economic equilibrium. As far as we concerned, the American financial systems are in total mess. The global economic system needs to be changed. Policymakers! Good Luck!
Saturday, February 14, 2009
How it's made! When I'm not a smoker
As you might have noticed, my blog has a new layout and a new banner. I really want to thank my friend, Edwin, for taking a great photo of me in a restaurant. Finally, the picture is well-deserved with creativity. I have gone through some tough time trying to be a real smoker. Basically, it took me at least 2-3 weeks to master the style of smoking. I always thought of taking a photo of myself while smoking. Now, here it goes. I wanted something very real and cool. Thanks to my friend and myself for making this wonderful banner. Yeah! It's cool.
To be honest with you, it is not an easy task. Afterall, I am not a smoker. You can call me a social smoker but I guess I am not one either. A new layout means a new style of blogging. Brainstorming is needed now. I am sorry that you just have to wait patiently. Cheers.
To be honest with you, it is not an easy task. Afterall, I am not a smoker. You can call me a social smoker but I guess I am not one either. A new layout means a new style of blogging. Brainstorming is needed now. I am sorry that you just have to wait patiently. Cheers.
Tuesday, February 10, 2009
I'm back to blogging again
Hi! I am deeply sorry for not being able to find times to post new stuff on my blog. I just came back from my hometown, having celebrated Chinese New Year with my family and friends. As far as I am concerned, everything went quite fine and fun with me. I know my hometown, Sandakan, is a little boring in terms of night life and so on. However, I did enjoy my time there cooking pasta and also making some new cocktail mix. Now that I am back to Kuala Lumpur, I will have more time to continue my blogging. Hopefully, it's gonna be fun. I gotta get back to my writing and reading. So, please wait... cheers
Subscribe to:
Posts (Atom)
Posts
