lowecur
Well-known member
- Joined
- Sep 14, 2003
- Posts
- 2,317
My figuring was dependent on Gary holding on to his positions. Since it sounds like they are unwinding them ahead of the curve, then the exposure to write offs will go with it. He just needs to be far enough ahead of the curve not to take any big losses. We'll just have to see how that all plays out in the coming 12 months.Lowecur,
We are still paying the fuel guy market prices. If oil drops to $30 (below hedge) were still better off operationally. GAAP might further skew the true picture, however. Keep in mind that our hedges caused us to show a "loss" but were still well above oil prices. If oil were to drop to 50 for Q1 you might see another "loss". If Q2 it rose to 60 (still below hedge) GAAP would show a gain because its relative to the last quarter, not the original purchase price. The new reporting rules in GAAP really dont make sense if you ask me.
If your house gains or loses 50k in a quarter you dont factor that into your personal net income do you? That is essentially what is going on here.
It will be interesting if some of the other carriers try and set the market in some of your key cities, as their biz model and expenses may give them an advantage with oil below $80. That could limit WN from increasing the revenue it will need to stay firmly in the black.
That being said, has anyone noticed the divergence in stock price between AAI and JBLU? I think JBLU faces some interesting decisions to refinance debt as it comes due in 2009 and beyond. DL may get their wish to buy them.
imp: