American Airlines planes at LaGuardia Airport
Leslie Josephs | CNBC
American Airlines said it canceled hundreds of flights this weekend due to staffing shortages, maintenance and other issues, challenges facing the carrier as travel demand surges toward pre-pandemic levels.
About 6% of the airline’s schedule, or 180 flights, were canceled on Sunday, according to flight-tracking site FlightAware. About half of those were because of unavailable flight crews, showed a company list, which was viewed by CNBC. On Saturday, about 4%, or 123 flights, were canceled, the site showed.
American said it is trimming its schedule by about 1% through mid-July to help ease some of the disruptions, some of which it said resulted from bad weather at its Charlotte and Dallas/Fort Worth International Airport hubs during the first half of June.
“The bad weather, combined with the labor shortages some of our vendors are contending with and the incredibly quick ramp up of customer demand, has led us to build in additional resilience and certainty to our operation by adjusting a fraction of our scheduled flying through mid-July,” said American Airlines spokeswoman Sarah Jantz in a statement. “We made targeted changes with the goal of impacting the fewest number of customers by adjusting flights in markets where we have multiple options for re-accommodation.”
Bad weather has impacted flight crews’ ability to get to assigned flights and bad weather can mean that crews can fall outside of the hours they are federally allowed to work, the spokeswoman said.
Dennis Tajer, spokesman for the Allied Pilots Association, which represents American’s roughly 15,000 pilots, said the company should offer more overtime in advance to encourage staff to fill in as well as more flexibility in pilots’ schedules to cover staffing shortages.
“They’re trying to put a Band-Aid on something that needs stitches,” said Tajer, who is also a Boeing 737 captain.
American is also racing to train all of the pilots it furloughed in between two federal aid packages that prohibited layoffs as well as its aviators who are due for periodic recurrent training. Jantz said American is on track to finish training furloughed pilots by the end of this month and added the company is offering overtime because of its operational issues.
The weekend’s disruptions, reported earlier by the View from the Wing airline blog, come just as carriers are trying to capture a surge in travel demand and stem record losses. American said in a filing earlier this month that it expects its second-quarter capacity to be down 20% to 25% from 2019, while United Airlines said it expects its capacity to be down about 46% and Delta forecast a 32% decline versus 2019. Meanwhile, Southwest Airlines forecast its July capacity to be off just 3% from 2019, down from a 7% decline this month.
Air conditioning and climate change: Start-ups trying to help
This June was the hottest in American history. The 116-degree heat melted power cables in Portland, Oregon, and smashed previous temperature records. Seattle recorded an all-time high of 108 degrees, as did the Canadian province of British Columbia, at a whopping 121 degrees.
As the world warms, more people are installing air conditioning. Global energy demand for cooling has more than tripled since 1990 and could more than double between now and 2040 without stricter efficiency standards.
But air conditioning itself is a major contributor to global warming. Altogether, building operations that include heating, cooling and lighting account for 28% of the world’s total greenhouse gas emissions. That’s more than the entire global transportation sector.
But SkyCool, Gradient and a number of other companies are working on the problem. They’re trying to apply new technologies to the traditionally inflexible heating and cooling industry, finance the upfront costs, communicate the value to property owners and make sure it’s all done equitably.
Watch the video to learn more.
The U.S. is deciding how to respond to China’s digital yuan
China is beating the U.S. when it comes to innovation in online money, posing challenges to the U.S. dollar’s status as the de facto monetary reserve. Nearly 80 countries — including China and the U.S. — are in the process of developing a CBDC, or Central Bank Digital Currency. It’s a form of money that’s regulated but exists entirely online. China has already launched its digital yuan to more than a million Chinese citizens, while the U.S. is still largely focused on research.
The two groups tasked with this research in the U.S., MIT’s Digital Currency Initiative and the Federal Reserve Bank of Boston, are parsing out what a digital currency might look like for Americans. Privacy is a major concern, so researchers and analysts are observing China’s digital yuan rollout.
“I think that if there is a digital dollar, privacy is going to be a very, very important part of that,” said Neha Narula, director of the Digital Currency Initiative at the MIT Media Lab. “The United States is pretty different than China.”
Another concern is access. According to the Pew Research Center, 7% of Americans say they don’t use the internet. For Black Americans, that rises to 9%, and for Americans over the age of 65, that rises to 25%. Americans with a disability are about three times as likely as those without a disability to say they never go online. That is part of what MIT is researching.
“Most of the work that we’re doing assumes that CBDC will coexist with physical cash and that users will still be able to use physical cash if they want to,” Narula said.
The idea of a CBDC in the U.S. is aimed, in part, at making sure the dollar stays the monetary leader in the world economy.
“The United States should not rest on its current leadership in this area. It should push ahead and develop a clear strategy for how to remain very strong and take advantage of the strength of the dollar,” said Darrell Duffie, professor of finance at Stanford University’s Graduate School of Business.
Others see the digital yuan as insidious.
“The digital yuan is the largest threat to the West that we’ve faced in the last 30, 40 years. It allows China to get their claws into everyone in the West and allows them to export their digital authoritarianism,” said Kyle Bass of Hayman Capital Management.
Watch CNBC’s deep dive video into CDBCs to learn more.
Warren Buffett’s advice from 1999 on how he’d invest $10,000
If you want to be as rich as Warren Buffett, don’t wait to get started. That’s the advice that the investing titan shared in 1999 at Berkshire Hathaway’s annual shareholders meeting when asked how to make $30 billion, which was roughly his net worth at the time.
The then-68-year-old Buffett — whose fortune has since grown to more than $100 billion — said that compound interest is an investor’s best friend and compared building wealth through interest to rolling a snowball down a hill.
“Start early,” Buffett said. “I started building this little snowball at the top of a very long hill. The trick to have a very long hill is either starting very young or living to be very old.”
The Oracle of Omaha said that if he were graduating from college in 1999 and had $10,000 to invest, he would be strategic about choosing where to put his money. “I probably would focus on smaller companies because I would be working with smaller sums and there’s more chance that something is overlooked in that arena,” Buffett explained, saying he would start examining companies alphabetically and work his way from there.
Investors, Buffett explained, need to fend for themselves and rely on their own knowledge and intuition when searching for promising businesses to invest in. He added that savvy investors would do best to “learn what you know and what you don’t” and act “very vigorously” when they see something they consider to be a good opportunity.
“You can’t look around for people to agree with you,” Buffett said of putting money into an investment. “You can’t look around for people to even know what you’re talking about.”
That said, Buffett is also a staunch supporter of index funds, which hold every stock in an index, making them automatically diversified. To build wealth, investors should “consistently buy an S&P 500 low-cost index fund,” Buffett said in 2017. “Keep buying it through thick and thin, and especially through thin.”
Still, Buffett said that aspiring to make $30 billion is unnecessary, and recently said that the size of his fortune is “incomprehensible.”
“The money makes very little difference after a moderate level,” he said.
He continued: “If you asked me to trade away a very significant percentage of my net worth either for some extra years on my life or being able to do during those years what I want to do, I’d do it in a second.”
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