Sell Delta

Warren said: If you want to be a millionaire, first be a billionaire and then buy an airline.

Dalta looks like a bargain if you look at its low expected P/E esp. when oil price is falling. However, there are too many major problems.

1. High debt. A common problem in this industry.

2. High pension obligation. Same as what bought down GM.  

3. High wages raised by unions.

Bankruptcy would reduce the above three problems. Buy it after the bankruptcy that could be coming.

4. Unable to raise the prices of the air ticket. They have to charge you to use the rest room to be profitable. 

5. Deregulation has its problems. The government have to regulate some industries and airline is one of them.
 
6. Besides competition from other airlines, high speed rail, regular rail... will offer a lot of competition for short distance. Merger will have fewer airlines and reduce competition that harm others and also harm itself.

7. Merger is not a solution. 1 Loser + 1 Loser = 2 Losers

8. The stupid hub concept is getting more stupid with high fuel price. 
 
The future will be less stop over with larger and newer jets that are more fuel efficient. I propose to fire all the fat stewardesses esp. those who block my way to the rest room.

9. High cost of terrorism.


Most foreign airlines are subsidized by the government. Our government has bailed out other industries but not the airline so far.



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How Clinton and I will save the airline industry or at least for a good laugh. PG17:
http://bit.ly/KWmI1N