Boeing plans to lay off about 10% of its workers in the coming months as it continues to lose money and tries to deal with a strike that is crippling production of the company’s best-selling airline planes.

New CEO Kelly Ortberg told staff in a memo Friday that the job cuts, which could total about 17,000 positions, will include executives, managers and employees.

The company has about 170,000 employees worldwide, many of them working in manufacturing facilities in the states of Washington and South Carolina.

Boeing had already imposed rolling temporary furloughs, but Ortberg said those will be suspended because of the impending layoffs.

The company will delay the rollout of a new plane, the 777X, to 2026 instead of 2025. It will also stop building the cargo version of its 767 jet in 2027 after finishing current orders.

Boeing has lost more than $25 billion since the start of 2019.

About 33,000 union machinists have been on strike since Sept. 14. Two days of talks this week failed to produce a deal, and Boeing filed an unfair-labor-practices charge against the International Association of Machinists and Aerospace Workers.

As it announced layoffs, Boeing also gave a preliminary report on its third-quarter financial results — and the news is not good for the company.

Boeing said it burned through $1.3 billion in cash during the quarter and lost $9.97 per share. Industry analysts had been expecting the company to lose $1.61 per share in the quarter, according to a FactSet survey, but analysts were likely unaware of some large write-downs that Boeing announced Friday.

The company based in Arlington, Virginia, said it had $10.5 billion in cash and marketable securities on Sept. 30.

The strike has a direct bearing on cash burn because Boeing gets half or more of the price of planes when it delivers them to airline customers. The strike has shut down production of the 737 Max, Boeing’s best-selling plane, and 777x and 767s. The company is still making 787s at a nonunion plant in South Carolina.

“Our business is in a difficult position, and it is hard to overstate the challenges we face together,” Ortberg told staff. He said the situation “requires tough decisions and we will have to make structural changes to ensure we can stay competitive and deliver for our customers over the long term.”

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With a net worth of over $14 billion, Ray Dalio is one of the most respected investors on Wall Street. He founded Bridgewater Associates in 1975, which has grown to become the world’s largest hedge fund, with roughly $97.2 billion in net assets under management.

Notably, Bridgewater Associates is the fourth most profitable hedge fund in terms of absolute dollar returns as the fund’s net gains amounted to approximately $55.8 billion between 1975 and 2023.

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Dalio thinks the U.S. economy is “in a relatively good balance” right now and doesn’t foresee multiple rate cuts. This sharply contrasts with market expectations, which signal at least two more rate cuts in 2024 alone.

Not On Any Preset Course: Powell

Wall Street rejoiced at the September rate cut by 50 basis points, with investors speculating about the magnitude of the next rate cut. However, Fed Chair Jerome Powell has hinted that future rate cuts might be smaller as the central bank cautiously navigates avoiding a recession while bringing down inflation.

“Looking forward, if the economy evolves broadly as expected, policy will move over time toward a more neutral stance. But we are not on any preset course,” he said. “The risks are two-sided and we will continue to make our decisions meeting by meeting.”

As the risks associated with rate cuts are two-sided, Powell acknowledged, “This [FOMC] is not a committee that feels like it’s in a hurry to cut rates quickly.”

Dalio’s Outlook On The Bond Market

Dalio believes the bond market is in a precarious position and Treasury bonds, particularly, have not been great investments recently.

“Treasury bonds have not been a great investment,” Dalio said at the Greenwich Economic Forum. “We have an interest rate risk in that bond market.”

With institutional investors and central banks holding substantial Treasuries, Dalio thinks the market may be overweighted in these securities.

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Furthermore, the erratic fluctuations in Treasury yields this year are a major deterrent as the two-year Treasury yield has swung between 3.5% and 5%, reflecting a market on edge.

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Bridgewater Associates’ Top Holdings

Dalio retired as co-CIO in 2022 and gave up control of Bridgewater Associates. However, according to the Bloomberg Billionaires Index, he still owns a 49.9% stake in the company.

The hedge fund has diversified its holdings across multiple sectors as evidenced by its second-quarter 13F filing.

Alphabet

Bridgewater Associates owns 4.54 million shares of Alphabet Inc. (NASDAQ:GOOGL), making it its third-largest holding – accounting for 4.32% of the total portfolio. The Magnificent Seven stock has been an investor favorite for a long time.

While the recent probe by the Department of Justice to break up Google’s dominance in the search engine industry has shocked many, industry experts have not reacted sharply to the news.

“We don’t believe there are any major surprises,” stated Doug Anmuth, an analyst at J.P. Morgan. “We don’t believe the high-level framework changes much for Google shares near term.”

In the wake of the DOJ’s court filing, Google wrote in a blog post that the “DOJ’s radical and sweeping proposals risk hurting consumers, businesses and developers.”

Analysts are mostly bullish on GOOGL stock, with a price target of $201.64. This indicates a potential upside of nearly 25%.

Procter & Gamble

Procter & Gamble Co. (NYSE:PG) stock is Bridgewater’s fifth-largest holding, accounting for 3.1% of the total portfolio. As of June 30, 2024, the hedge fund’s stake in Procter & Gamble was valued at $592.90 million.

The consumer goods giant’s stable dividend makes it a staple investment for defensive plays. The company has increased dividend payouts for 68 consecutive years, making it a Dividend King. Proctor & Gamble pays $4.03 in dividends annually, yielding 2.39% on the current price.

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This article Billionaire Ray Dalio Is Skeptical Of The Recent Rate Cuts – These Are The Stocks He’s Holding originally appeared on Benzinga.com