LCC is the biggest loser today!

[Bear96]

No, we can all thank that paragon of Republican virtues, Richard Nixon, for the current mess. Back when he was POTUS and the good ole USofA was the biggest consumer of oil by far, Tricky Dick forced the OPEC nations to price the sale of crude oil in US dollars. Since then, no matter who you are you have to have dollars to buy oil. At the time it seemed like a canny move and it further strengthened the dollar because a demand for oil was preceded by a demand for the dollars to pay for said oil.

I don't think you understand how the international currency market works.

The reason oil is at $130/barrel today is because people are willing to pay $130/barrel for it today. Someone who has Euros just exchanges their 85 Euros into 130 dollars (approx.) and buys that same barrel. If oil were priced in Euros today, a barrel would be 85 Euros and it would still cost (approx.) 130 U.S. dollars to buy a barrel.

Want the price to go down? Stop buying oil.

 

[BuffaloJoe]

Don’t forget the HUMVEE drivers as well , I thought I saw bin laden riding in one yesterday laughing ….

And the SUV Drivers. Its all an image thing, who looks cooler. TV news blames we Americans are getting fat on Fast Food. Also we Americans do not walk down to the corner for that gallon of milk. I turned my old refrigerator on and I am gonna try to do all my grocery shopping to last me two months. Milk and a few nick nacks I can go down the corner Mini-Mart.

 

[cynic]

Bite your tongue. CO might hear you! Shhhhhh...oh wait, CO and WN have the strongest balance sheets and they both treat their customer base well and their employees with respect...never mind.

WN has a strong balance sheet only because they're paying half the market rate for their fuel. Treating people well is nice, but has ZERO impact in fuel prices. Now if you want to talk about the hedging gamble they made a couple years ago paying off, that's a different (and true) story.

 

[phlus2]

Would now be a good time to buy LCC stock? It can't go much lower. One of two things will happen. You will either lose it all in a chapter 11 filing or double your money with a merger announcement.

Chapter 11 would be great - a merger announcement would be terribly depressing because that means that US is going to drag another airline to the bottom.


So as you might guess - I'm not of the opinion you should by LCC stock at this point since I'm cheering for bankruptcy.

 

[flybynite]

If the dollar were stronger, wouldn't that cause more companies to move over seas?

Wouldn't a company move production, or outsource production, to a country with a weak currency and buy them foriegn products as opposed to "Made in the USA" products? .


I would think if gas prices are so bad, you'd just drill in Alaska. Polar Bears be damned.

Getting back to Nixon policies, Nixon took us off the Gold Standard and put us on what is known now as Petrol Dollars. Which put us at risk. As was shown so clearly with the first OPEC oil embargo back in the 70's.

Now we have the Oil Futures Traders driving the price of a barrel of sweet crude through the roof and I want to know who they are and who is financing them. The Senate is hauling the CEO's of the Oil companies in for hearing yet have failed to jerk the futures traders in for questioning. Why?? The SEC is seating on their hands and really don't have the means to look into this. This really a job for the FBI.

Companies move overseas because of our stupid tax and trade policies not the price of oil. Another GOP shortsightedness.

 

[luvn737s]

So if they overspeculate and end up with $150/bbl oil in a market only getting $100/bbl for it, would that justify calling off the FBI? Or will the government just bail them out like they are housing speculators?

 

[Be Careful What You Wish For.]

To the OP-you are the biggest loser for posting erroneous information in the thread title.

 

[SolidCactus]

Honestly, if a merger was announced, I don't think the airline stocks would go up. They could possibly see a few percent gain, but my guess is they would stay flat. Most investors know that mergers and acquisitions cost A LOT of money before any savings can often be realized. This is NOT the time for a merger or acquisition... These only work when a VERY PROFITABLE company goes to acquire a smaller, less profitable company.

The entire transportation segment is in trouble, with the exception of possibly rail companies like CSX. Companies like UPS, Fed Ex and DHL will probably hold their own. Even though the price of oil greatly effects their bottom lines, all three of these companies are known for efficiency through technology, and will most likely manage to increase their margins as the cost of oil rises.

This problem is not going to get better anytime soon. You can count on gasoline being $5 a gallon by years end, and oil at least $175 a barrel.

Oh yeah, and while we're at it... Just in case you guys dont know, Nixon is also the jerk who is responsible for our current wonderful healthcare system. But that's a whole other story...

 

[bagchucker]

Humvee's should be outlawed. I know its freedom of choice, but honestly... who needs a 50 gallon tank on a vehicle that can barely get 5 miles to the gallon... yea I think I want to spend $200 to fill my tank every week...NOT.

 

[Edward]

As this has gone political & and about oil follow it in the "Water Cooler".

 

[SolidCactus]

Bite your tongue. CO might hear you! Shhhhhh...oh wait, CO and WN have the strongest balance sheets and they both treat their customer base well and their employees with respect...never mind.

You guys may not think this is important, but it is. Employees who are treated with respect tend to care about the company they work for, and they will try to save money for the company... I still fly US a lot, and I do think that most of the US employees are still very proud and really do care about the customers - but imagine managing a workforce of 30,000 plus... Even if 10% of the employees have a bad attitude, thats 3,000... Think about how much money 3,000 employees could lose a company. There is a saying... #### flows downhill...

Employee morale starts at the top. US really needs to invest in quality management, and create a management team that the employees trust and respect, and unfortunately this has to start at the top. Even if US could recruit quality management from other companies, the best managers being hired into middle management will be totally ineffective if they don't believe in the executive team.

Oil prices are a huge problem, but it isn't the only problem.

 

[28L_or_10R?]

Would now be a good time to buy LCC stock? It can't go much lower. One of two things will happen. You will either lose it all in a chapter 11 filing or double your money with a merger announcement.

Analysts on CNBC stated yesterday that now would be a good time to invest in airlines. I would wait until there are definite signs that the oil bubble is about to burst. That is for long term. For the short term (we're talking days), buy it cheap and sell immediately on a decent rise, it will go back down, buy, repeat... LCC has been a day-trading favorite for its predictable chart pattern.

There are ways to profit in the future from this oil mess: Invest in the following companies that have developed a system to develop synthetic jet fuel and diesel:

Syntroleum (listed on AMEX as SYNM):

Syntroleum Corporation engages in the research, development, and commercialization of the Syntroleum Process that is designed to convert natural gas into synthetic liquid hydrocarbons. It owns the Syntroleum Process for Fischer-Tropsch (FT) conversion of synthesis gas derived from biomass, coal, natural gas, and other carbon-based feedstocks into liquid hydrocarbons; the Synfining Process for upgrading FT liquid hydrocarbons into middle distillate products, such as synthetic diesel and jet fuels; and the Bio-Synfining technology for converting animal fat and vegetable oil feedstocks into middle distillate products, such as renewable diesel and jet fuel. The company, through its joint venture with Tyson Foods, Inc., focuses on siting, engineering, and constructing a plant that produces clean renewable synthetic diesel and jet fuel using low grade fats and greases as feedstock. Syntroleum Corporation was founded in 1984 and is based in Tulsa, Oklahoma.

Rentech (listed on AMEX as RTK):

Rentech, Inc. provides technologies that utilize domestic resources to produce ultra-clean synthetic fuels and chemicals. It licenses its proprietary derivative of the Fischer-Tropsch process, called Rentech Process, which converts synthesis gas derived from coal, petroleum coke, biomass, natural gas, or municipal solid waste into liquid hydrocarbon products, including ultra clean diesel fuel, jet fuel, naphtha, specialty chemicals, and other fuel products. Rentech, Inc. also manufactures anhydrous ammonia, UAN, nitric acid, carbon dioxide, and granular and liquid urea. In addition, it has a joint development agreement with Peabody Energy Corporation for the co-development of CTL projects that convert coal into ultra-clean transportation fuels using the Rentech Process. The company was founded in 1980 and is based in Los Angeles, California.