First, start with a large fortune.
American Airlines and its parent company, AMR, are bankrupt.
I can understand the romance of aviation. But one has to wonder why anyone would ever invest in an airline. Most are not profitable and, if you look back over time, they have never been profitable in the long term. Buying airline stock now is like buying stock in the New Haven Railroad once was: Maybe you can make money short-term, but if you buy and hold, you'll get fucked.
I've heard it said that the airlines were profitable during the Great Depression. If they were, it was only because they carried airmail. At the time, airmail was the fastest way to send reasonably secure communications. Telegrams were faster, but they were by no means secure. Or if you had a package to send and it had to get there quickly, airmail was it. So one might argue that without the government, there would be no airline industry: There would have been no Boeing-40, -247, no DC-2, -3, -4 which meant that the Army would not have had good air transports available for the war (and quite possibly, no Douglas Aircraft Corp.).
Then there is the point that a number of the airlines, especially Untied and American, would have been out of business after 9-11 if the Federal government had not bailed them out, but a Republican was the president then and the "we don't do bailouts" Republicans seem to not give a shit when there is a GOP president. Just as in the same way, they don't give a shit about the deficit whenever a Republican is sitting in the Oval Office.
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Slava Ukraini!
Wednesday, November 30, 2011
1 comment:
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Remember that Robert Crandall, stated that he did not make his fortune in the Airline, he just made his living in the Airline. He had a few other choice remarks about the Airline Industry, none of them would make you want to invest in such an enterprise.
ReplyDeleteIt is really too bad that Alfred Kahn, lived as long as he did, and I am sure he will be remembered for the mess that he help create with the demise of the CAB. He help convert an industry, turned into a knife fight to the bottom.