The private aviation sector continues to hit the headlines. Some analysts see the very high end of the travel market as indicative of the health of the economy. During the global financial crisis of 2008-2011, you wouldn’t have seen too many high-level executives jetting around in private aircraft.
Company accounts for certain failing banks showed depreciating assets of private aircraft and large expense bills on flying private as well. The demand from corporations never recovered after the crisis, but in an age of social media “influencers” and visual “one-upmanship”, the private aviation sector bounced back strongly, finding new demand from the young and rich, tech entrepreneurs and Asia.
China Eastern airline stewardesses visit a Dassault Falcon acraft at the 2013 Asian Business … [+] Aviation Conference & Exhibition (ABACE2013) held at the Shanghai Hawker Pacific Business Aviation Service Centre on Hongqiao Airport in Shanghai on April 16, 2013. The annual show will run on April 16, 17 and 18 and features all major business aviation aircraft manufacturers. AFP PHOTO/Peter PARKS (Photo credit should read PETER PARKS/AFP via Getty Images) AFP via Getty Images
Furthermore, with some commercial airlines offering products that are arguably better than private jets, there are aspects of the resilience of the industry that has understandably been called into question. Add to that the very real and relevant focus of climate change and all the ingredients are there for a very niche and high-end part of the travel industry to face headwinds.
Yet, the sector continues to flourish and grow.
Neil Mathew founded Imperial Fleet LLC in 2014 which started off as a high-end luxury car service which later expanded into the private jet arena.
With more entrepreneurs and super-wealthy clients holding meetings in private jets that shave time off traveling across the world the business not only are but like many companies in private aviation, garnered overseas interest.
Neil Mathew founded Imperial Fleet LLC in 2014 which started off as a high-end luxury car service … [+] which later expanded into the private jet arena. Neil Mathew
Mathew says that “private aviation remains a growing market” and with the current aviation market leaning more into digital app technology despite maintaining exclusivity, Mathew says that there continues to be “many new players entering the market.’
“Big players began to expand their portfolios and fleets by consolidating and strategically buying certain competitors.” China has been making major investments in aviation globally, and the U.S. has seen part of this global spending spree of $2 trillion into foreign projects.
Mathew’s Imperial Fleet was acquired by a Chinese investment firm in 2019, in a major move that demonstrates consolidation and growth could continue in the market, driven by overseas investment. Mathew now focuses on investment in the real estate market after witnessing the growth of the private aviation sector.
In China, the demand for private jets continues to increase, however, the trend is strongly pointing towards renting and not owning, similar to the concierge-type service that Imperial Fleet offered the market.
Younger Chinese tech entrepreneurs are increasingly renting private aircraft for corporate trips, due to increased scrutiny of expenses, however, that does not mean the demand to use private jets is decreasing.
With the use of private aircraft increasing by as much as 25% in China over the last year, growth in Asia is expected for several years to come.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
