News and notes from around the interweb:
- Time to register for Starwood’s new promotion Triple Up
- For reservations made by May 31 and stays through August 31, Le Club Accorhotels is offering up to 6000 bonus points.
- A map of wireless passwords from airports and lounges around the world (HT: Chua J.)
- Starbucks is being sued for putting too much ice in their drinks so a 24 ounce drink doesn’t really have 24 ounces of drink. Starbucks, though, says:
“Our customers understand and expect that ice is an essential component of any ‘iced’ beverage,” a spokeswoman for the Seattle-based company said. “If a customer is not satisfied with their beverage preparation, we will gladly remake it.”
- Delta lost $4 billion over the past 8 years on fuel hedging. Anyone want to argue with me that they’ve been as much complex derivatives trading firm as airline (and not a very good one at that)?
- Earn 15,000 mile with a single Etihad flight via their BusinessConnect program’s signup offer.
- I fly 747s for a living. Here are the amazing things I see every day.
Here’s Paul Kelly’s classic Sydney from a 727 performed as as ‘Sydney from a 747’
Hopefully the losses that Delta and Cathay (amongst others) have taken due to hedging will slowly convince the industry that they cannot be as good as the finance people on the other side of these trades
Delta is definitely an airline and not a derivatives trading firm. But they were making a poor business decision hedging their fuel needs. They failed to realize that Wall Street had changed the hedging game, and that Delta would lose almost regardless of which way oil prices moved. Basically, unless prices skyrocketed, Delta would lose hundreds of millions of dollars. And if oil went down hard, they’d lose billions.
What was particularly foolish about this is that Doug Parker constantly explained this in his quarterly conference calls, first with US Airways and then with American. He produced the numbers. He almost always paid way less for fuel than everyone else, regardless of which way the oil market moved.
It took the big collapse in oil prices for Delta to adopt Parker’s strategy. By that time, $4 billion had left the building.
Mind you, Parker gets almost no praise for his brilliance on this issue. I doubt many investors have a clue about it.
Thank you so much for bringing the article by 747 pilot Mark Vanhoenacker to our attention. It was a wonderful post and I look forward to reading his book.