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December 30, 2004
Thursday, December 30, 2004 08:08:13
Boeing Hype-Fatigue
Boeing (NYSE: BA) has apparently rung up another sales order for the 2009 7E7 from Continental Airlines (NYSE: CAL), which is the fifth largest U.S. air carrier. Yawn.
The manufacturer reports that firm orders for its 2009 Dreamliner are now 56 with commitments for another 66. The list price is about $127 million per unit.
CNBC Talking Head Brad Goode reported on "Wake Up Call" at precisely 6:00 AM ET today that:"Industry analysts say Boeing will not meet their 2004 sales targets, but not to be concerned if they slid a bit."
Now just wait a minute! I for one refuse to accept this nonsense. As I reported Tuesday, it was 7E7 Boeing Marketing VP Randy Baseler who said exactly that; Straight from the words of management to the mouths of CNBC TH's! This did not come from "industry analysts."
To wit: "Rather than stand up and take it like a CEO, however, Harry had Randy Baseler, head of marketing for Boeing's commercial aircraft division, be the man to tell us earlier this month that Harry's pledge of 200 (which now by the way includes the earlier ANA order) just might fail, but that we should "not be too concerned if that target slipped by a month or two". (BillCara.com)
It has become abundantly clear that GE (CNBC) and Boeing are married at the hip. GE provides most of the jet engines for Boeing planes and the financing for their customer purchases, and Boeing is a major advertiser on CNBC. These are the obvious connections.
Just watch what (and how much) CNBC personalities say today about Boeing regarding this Continental order for ten 7E7's " a 2009 purchase by the way. This "news" will be promoted on the headlines and by way of commentary and innuendo all day long because these CNBC people are bought and paid for.
To confirm my views, at 6:17 AM ET today, the CNBC Morning Show "Wake Up Call" ran a commercial for Boeing. At the end, this commercial stated: "This program (i.e., "CNBC Wake Up Call") is sponsored by Boeing."
Are you starting to get the picture how these big corporate (capitalist) networks work?
So, all day long (and well into the future) you can expect more of the same;Boeing's 7E7 sales are in good shape. Hah!
Along the same line of thought, State Street Bank's chief market strategist Ned Riley, a very frequent CNBC guest host or part time Talking Head, is NEVER going to say an objective thing about Boeing on account of the fact his employer holds over $5 billion of the stock. Yes, that's $5 billion.
Can you imagine Riley telling the CNBC audience that Boeing management has failed to live up to its promises -- so he now thinks the stock should be ranked ‘Underperform' " with a target of say $40, which is what this company is probably worth?
There isn't one chance in one billion Ned Riley is going to make that call. Because if BA were to drop from $52 to $40, the accounts owned or managed by his employer would be down well over one billion dollars.
So Ned, it's the money talking, and because of that, you are just one more clown in the CNBC circus tent.
By that I simply mean that when Ned Riley speaks, like the parade of Wall Streeters before him, and after, he is in the business of entertainment, because it sure isn't independent and objective commentary. The axe to grind by most of these clowns must be so heavy I'm surprised they can even find the strength to drag it around from one media outlet to another.
That's not a personal remark by the way. It's just someone, who used to do what Ned Riley does for a living, calling a spade a spade.
The point I'm making has nothing to do with Brad Goode, Ned Riley, State Street Bank, or even Boeing for that matter. It has everything to do with the absolute hypocracy that exists in securities markets when your advisors and agents are permitted to be simultaneously working for others against your interests, and not telling you in every instance that these conflicts exist.
I simply ask these hypocrites, where is the accountability? You see, clowns aren't accountable. That's precisely why they're clowns.
Finally " I think I even get me fed up with myself on this Boeing stuff " on Tuesday I told you that there is no chance that China is going to order the 7E7's that Boeing management has been leading us to believe would happen.
To wit: "Re the Yuan, we all know that the Bush administration has pulled out all the stops to get the Chinese to stop Dollarization, i.e., the U.S. Dollar peg. Wouldn't that dramatically upward valuation of the yuan just be the icing on Harry's cake? Probably would lead to an immediate order of at least 60 7E7 units!; the Chinese will actually be a tougher sell than the Japanese because of the quid pro quo already received by Japanese manufacturers to build parts of the 7E7. In fact, the Japanese now stand to gain so many manufacturing jobs from the 7E7 that I hardly think it fair, if, as and when it gets built, to call the new plane ‘American'." (BillCara.com)
So now we read that the Chinese authorities say no aircraft orders to Boeing because their economy is overheated. Hah!
The day the Chinese buy 2009-model 7E7's will be the day (i) the Yuan is revalued so far north these pricey $127 million units will cost them the equivalent of something like $67 million, and (ii) when Chinese manufacturers get handed work packages for the 7E7 plane similar to the ones that Boeing forked out to the Japanese to secure the ANA and JAL orders (or is that commitments?).
Maybe smart investors are starting to wake up to this BA story? After I published Tuesday, and then the China "not interested" story came out, the stock got hammered Wednesday at the open.
But the Boeing PR machinery never sleeps. One bad news is immediately followed up by a good news day. China one day; Continental, the next.

So, enough already for Boeing;I'm suffering BA hype-fatigue, and I'm thinking of calling my family doc. All of this is just too much on top of my flu.
Posted by Posted by Bill Cara on December 30, 2004 07:57:59 AM | Category: Cara Today in the Market
