AirTran tacks on add'l $140M to cash

[lowecur]

I agree with Andy on the bailouts, it didn't help Japan in the 90s and it won't help us now. How long do you see this depression lasting and what can be done to help soften the blow? Do you think the dollar is going to continue getting stronger or will we see it collapse?

The dollar will eventually collapse, but that won't happen till China, Russia, and Japan start pulling their $$$ out of here to support their own quickly sinking economies. The timing on that will start sometime next year. The Treasury will have to print $$$ as the Federal Reserve will have to fund it's debt from within. Thus will begin the monetization and eventual official devaluation of the dollar. Get your wheelbarrels out.

imp:​

 

[Andy]

Not entirely correct. You have some tax advantages from owning. You need to figure out your tax bracket, and see if you could use some of the right-offs of interest, property tax,etc.. You can take home more every month. Obviously you need to buy at the right price, but the price of paying higher taxes can hurt as well.

JetFumes, with all due respect, you have been brainwashed by realtors. And completely wrong.
Thanks to my investment strategy over the last year (yes, I put my money where my mouth is), I am DEEP in the 35% marginal tax bracket. In spite of that, home ownership would be an extremely poor decision for me.
Before a dime of your Schedule A 'counts', you need to remember that a standard deduction for married joint is $10,900. The realtors rarely mention that small 'detail' in their calculations.
I specifically wrote about the current environment (likely to persist through 2014). One needs to understand that for the average person, buying a home is a highly levered investment. It's an investment because you almost always have the choice to rent vice buy. If you put 20% down, you're levered 5:1. But most put down no more than 5%; levering themselves to 20:1 or greater. That's a play that makes a huge ROI when real estate prices increase, but will crush you when real estate prices decline. Take a look at the Case-Shiller Housing Index. November's numbers showed an annual average decrease in housing prices of 19.1%. Dallas fared best at a 3.3% annual decrease in home values. http://blogs.wsj.com/economics/2009/01/27/a-look-at-case-shiller-numbers-by-metro-area-5/ However, the month over month decrease was 2.2%, showing an acceleration on the downside.
In the past, I've seen where realtors have factored in home appreciation in order to justify buying a home. I suspect that they leave out home depreciation when working the numbers in the current evnironment. Considering that anyone buying a home today will likely owe more than that home's worth by the time that home prices bottom, it is foolish to buy a home today.

 

[Andy]

The dollar will eventually collapse, but that won't happen till China, Russia, and Japan start pulling their $$$ out of here to support their own quickly sinking economies. The timing on that will start sometime next year. The Treasury will have to print $$$ as the Federal Reserve will have to fund it's debt from within. Thus will begin the monetization and eventual official devaluation of the dollar. Get your wheelbarrels out.

imp:​

I'm not sure about a dollar collapse; we're the leper with the most fingers. However, China, Japan, et al will likely slow down on purchasing US Bonds considerably. This will drive interest rates through the roof, further trashing home values.

Again, I put my money where my mouth is and have a sizable position in TBT (ultrashort the 20 year bond).

 

[Andy]

No, a depression is not likely, and I stick to my original prediction: the recession won't last longer than three quarters. You're still nuts.

Last quarter's GDP of -3.8% puts the official 'recession' at 12 months. Nice call, PCL. I may be nuts, but at least I'm not delusional. http://online.wsj.com/article/SB123332206003833245.html

The same 'experts' that never saw this coming are calling for the 'recession' to end second half 2009. Good luck with that one. 2009 is likely to be much worse than 2008 as we see unemployment numbers exceed 9% (I'd call for >10% but I'll sandbag it with >9%).

I hate to say it, but the government is doing everything possible to make this economic downturn longer and deeper than the Great Depression. I no longer think that this will be a mild depression; we're heading full bore toward a multidecade economic malaise. Until they follow Andrew Mellon's sage advice to Hoover, we're in for a rough ride.

"Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate. It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up from less competent people." -Treasury Secretary Andrew Mellon's advice to President Hoover, November 1929

 

[Ty Webb]

That sounds like some pretty tough medicine, Andy . . the kind of medicine that kills the patient, not cures him.

I have heard that some recent US Gov;t bonds have an interest rate approaching zero. What do you think of the Gummint using the low-interest bonds to make mortgage loans to qualified buyers, at a very attractive (yet profitable) interest rate of, say 3 or 4 percent? The Government would then be producing liquidity while making a profit . . . . home sales could flourish at those low interest rates.

 

[Jetjockey]

One thing for certain, i don't think anyone here on this board understands the economy better than Andy. I've read his postings for sometime, he usually nails his predictions. Go back and check it out for yourself.

 

[NuGuy]

One thing for certain, i don't think anyone here on this board understands the economy better than Andy. I've read his postings for sometime, he usually nails his predictions. Go back and check it out for yourself.

Heyas,

Agreed. Andy's musings are in line with my own predictions from another thread.

Adding to what Andy as already said, gold production has been oversold, but this fact hasn't made it into the mainstream. When it becomes apparent that it isn't going to be the readily available "haven" it has in the past, the price is going to go into orbit.

When it becomes known that gold is in short supply, this will cause another panic, and will probably be the spark that ignites the collapse of the dollar. Hyperinflation ensues.

The fiscal policy of the current (and past) administrations has put us on course for a dreadful economic collapse that will last a decade, if not longer.

Nu

 

[maxblast72]

Cargo traditionally pays a LOT more than that for the same space...

Traditionally may be the key word. We had the Fedex MEC chair at the ALPA Q & A session a few weeks ago, and he wasn't painting a real rosy picture. He talked about how the demand for their premium next-day product was falling off a cliff in the current economic environment.

From the way he was talking, it looks like the days of saying Fedex/UPS are recession/furlough proof are probably going to be over by the end of 2009.

 

[maxblast72]

BTW... Analysts are predicting a $74 million profit for AAI in 2009...

Current projections (as of 1/21/09) are now $0.99/share which correlates to about a $117 million profit for 2009 (118 million outstanding shares). That projection has been upgraded about 5-10 cents per share every couple weeks as Jet A prices remain below $1.50/gallon with no rebound in sight.

 

[atldc9]

MGMT is forecasting to end the year with about 150 million shares outstanding due to warrrants and convertible bonds being called for stock. FWIW

 

[Colonel Savage]

MGMT is forecasting to end the year with about 150 million shares outstanding due to warrrants and convertible bonds being called for stock. FWIW

Will that dilute the stock and pressure the price down?

 

[JetFumes]

JetFumes, with all due respect, you have been brainwashed by realtors. And completely wrong.
Thanks to my investment strategy over the last year (yes, I put my money where my mouth is), I am DEEP in the 35% marginal tax bracket. In spite of that, home ownership would be an extremely poor decision for me.
Before a dime of your Schedule A 'counts', you need to remember that a standard deduction for married joint is $10,900. The realtors rarely mention that small 'detail' in their calculations.
I specifically wrote about the current environment (likely to persist through 2014). One needs to understand that for the average person, buying a home is a highly levered investment. It's an investment because you almost always have the choice to rent vice buy. If you put 20% down, you're levered 5:1. But most put down no more than 5%; levering themselves to 20:1 or greater. That's a play that makes a huge ROI when real estate prices increase, but will crush you when real estate prices decline. Take a look at the Case-Shiller Housing Index. November's numbers showed an annual average decrease in housing prices of 19.1%. Dallas fared best at a 3.3% annual decrease in home values. http://blogs.wsj.com/economics/2009/01/27/a-look-at-case-shiller-numbers-by-metro-area-5/ However, the month over month decrease was 2.2%, showing an acceleration on the downside.
In the past, I've seen where realtors have factored in home appreciation in order to justify buying a home. I suspect that they leave out home depreciation when working the numbers in the current evnironment. Considering that anyone buying a home today will likely owe more than that home's worth by the time that home prices bottom, it is foolish to buy a home today.

I guess you have to ask yourself the question of whether your going to live in a certain area for a good amount of time or not. In the short term, prices may still go down, but I paid 200,000.00 less for a home in my area than I would have a year and a half ago. I was renting before that. My wife an I earn a good amount, and we plan on living here indefinitely, so after crunching the numbers it made sense. You need a place to live, so it makes sense to own if the PRICE is right. Our home is our home, not an investment. I'm not the sharpest guy around, but what is a good investment right now?

 

[gt1900]

Max... Don't try and make it too hard. Just lookie here...
http://investor.airtran.com/phoenix.zhtml?c=64267&p=irol-estimates


As of 1/21/09 the forecasted earning are $99 million for 2009. Your right, it has been steadily going up. Lets hope that continues and AAI actually makes their projections...