SWA Fuel Hedges

[greenbayfan]

Here's what I don't get>>>let's assume most airlines didn't want to hedge because they wanted to remain more liquid....why not finance the fuel hedges???? They finance aircraft, parts, buildings, but not the highest cost item on their balance sheet in order to save in the long run?????

 

[spciii]

Here's what I don't get>>>let's assume most airlines didn't want to hedge because they wanted to remain more liquid....why not finance the fuel hedges???? They finance aircraft, parts, buildings, but not the highest cost item on their balance sheet in order to save in the long run?????

Ever tried to borrow money from the bank to play the commodities market? Or even the stock market? I'm no financial analyst, but I think you need to have some tangible form of collateral in order to borrow. Of course, if other airlines borrowed against their their aircraft/assets to pay for hedges, it still wouldn't solve the liquidity problem.
spciii