Suing Starbucks Over Ice and the Amazing Things You See from a 747

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About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. 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

  2. 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.

  3. 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.

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