On Thursday, Bombardier announced the dismissal of Aviation unit President David Coleal and the elimination of the position, saying that it simplifies the corporate leadership structure. While the move caught many off guard, it’s not surprising for a company dealing with a plethora of simultaneous challenges.

The announcement comes on the heels of Spirit AeroSystems’
SPR
warning last week that it was uncertain about closing on its $500 million acquisition of Bombardier’s aerospace structures plants in Northern Ireland and Morocco. The sale of Bombardier’s rail division is still expected to close in the first quarter of next year, but not before buyer Alstom used Bombardier’s position of weakness to write itself a nearly billion dollar discount from its original offer. Fortunately, the sale of its CRJ Series aircraft program to Mitsubishi closed in June.

Through divestitures, Bombardier has now whittled itself down to a pure-play business jet manufacturer, the timing of which could not be worse. Business jet deliveries fell 26.7% in the first half this year compared to the same period in 2019, driven by Covid-19 factory and supplier disruptions. It’s anticipated that by year-end, 2020 will be below the previous year by a similar percentage due to soft jet sales.

Bombardier has historically been the most undisciplined manufacturer when it comes to heavily discounting newly built unsold airplanes known as white tails. Cash flow and holding cost avoidance trump profit margins. This now predictable reaction causes consternation for its competitors — General Dynamic’s
GD
Gulfstream, Dassault, Textron’s
TXT
Cessna, and Embraer — who tend to exercise more fiscal restraint. Bombardier’s actions erodes the industry’s pricing power, which can take years to recover to previous levels.

This cycle has already begun, with its latest, top-of-the line, brand-new Global 6500 and Global 7500 business jets available for immediate delivery. The

WASHINGTON (Reuters) – Turmoil in money market mutual funds sparked by the coronavirus pandemic shows that decade-old reforms to the industry may not be enough to avert major outflows during a future crisis, Deputy U.S. Secretary Justin Muzinich said on Tuesday.

Muzinich said in remarks to a New York Federal Reserve conference that the Money Market Mutual Fund Liquidity Facility created in March was critical to restoring financial market functioning as broad shutdowns of the U.S. economy got underway.

But high demand for fund withdrawals was due to different metrics than those operating during the 2008 financial crisis, he said.

In 2008, the Reserve Primary Fund “broke the buck” when its net asset value fell below $1 as a banking crisis accelerated, causing a stampede of fund withdrawals that were quelled only by a U.S. Treasury backstop for over $3 trillion in fund assets.

The 2010 Dodd-Frank financial reform legislation required money market mutual funds to hold 30% of their assets in instruments that are liquid within a week, among other reforms. But Muzinich said that when some funds neared this threshold in March, withdrawal requests accelerated.

“The events of this past March show that those reforms may not be enough,” Muzinich said. “For example, one might ask whether we have exchanged one psychological bright line for another.”

Muzinich said such lines have the potential to create “run dynamics” in markets as they are approached. But he stopped short of calling for further specific reforms.

“While policymakers were able to avert a run, it is worth asking whether there are ways to enhance the liquidity resources available to funds without using a bright-line test, or whether there are ways to draw a line without creating a first-mover advantage,” Muzinich added.

Low yields on U.S Treasuries and other debt have forced

Wall Street’s more than five-month-long bull run suffered a setback in September. Month to date, all the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — are down 3%, 4.2% and 5.6%, respectively.

Wall Street is expected to continue fluctuating in the near future primarily due to a spike in new coronavirus cases in several countries in Europe and some states in the United States, lack of vaccine or a line of treatment for COVID-19, uncertainty regarding a fresh round of fiscal stimulus from the U.S. government, intensifying geo-political conflict between the United States and China, and the U.S. presidential election scheduled on Nov 3.

Nevertheless, a handful of momentum stocks with a favorable Zacks Rank are flying high after withstanding the September meltdown. These stocks have solid growth potential too. Investment in these stocks is likely to be fruitful in October.

Momentum Investing to the Rescue Amid the Meltdown

Momentum investing calls for a continued appraisal of stocks, ensuring that an investor does not pick a beaten-down name or overlook a thriving one. Momentum investors buy high on the anticipation that a stock will only ascend in the short-to-intermediate term.

In the current scenario, the market’s worst appears to be behind us as negative estimates are already factored in valuations. Several economists have pointed out that the pace at which the U.S. economy recovered during the May to July period dwindled in August. Slow growth in job data, retail sales data and durable goods orders are all examples.

However, the vital point here is that the economy  is still growing, albeit at a slow pace, despite the lack of the second tranche of fiscal stimulus amid continued coronavirus-led woes.

On Sep 16, in his lecture after the conclusion of the two-day FOMC meeting,