I'm out of the country most of the summer, but I'm still keeping an eye on what's going on. Not too much happening in the industry or at LCC in particular, except that we've been seeing an encouraging rebound in RASM numbers lately. I think we can conclude that the industry remains strong. Nothing too exciting going on with the merger, which is exactly what we want. The proxy service called me to remind me to vote my shares, and I urge everywhere to take the couple of minutes necessary to phone in your vote for the merger.
US economy/stock market seems unchanged to me. I'm guessing that the eventual slowdown in money printing will eventually harm the overall stock market results, but that's a low probability prediction. US still seems stronger than the rest of the world.
Oil prices remain a riddle wrapped in an enigma. US oil revolution marches along -- Texas production is up a third in a year! -- with an extra 1.2 million barrels a day produced (20% yoy increase). US oil demand continues to decline. China economy continues showing signs of material slowdown. If this was a fundamentally-driven market, it would already have crashed. Big time. But since it's not, it putters along. Dan Dicker (Oil's Endless Bid) theorizes that funds that have been burnt in other commodities (ie, gold) have moved into oil; he half-jokingly says we're going to see oil fund ads on CNBC soon! I'm not sure he's right, since NOBODY can predict the oil market, but his theory makes a lot more sense than the nonsense you can read in the daily Bloomberg energy dispatches. The best Bloomberg theory -- that's it's geopolitical risk from Egypt -- can't possibly be right, because a slowdown in China is WAY more important than the tiny risk that Egyptian "uncertainties" bring to the marketplace. Bottomline, oil remains the biggest wildcard to airline investing, and that doesn't seem to be changing anytime soon. I still think we're headed to an epic oil crash. Sometime.
Who knows with oil, but generally agree with your assessment. My question is if the hedge funds are taking advantage of inventory glitches as oil is now moving out of Oklahoma (one point of measurement) and not being measured adequately on where it is going. It's only been a few weeks and distribution, I imagine, has to settle down ... but as I said, it is a question.
That said, and as you said, the airlines are in a period of a better business/leisure mix which is stronger rasm and if that isn't enough, fare increases can happen under those conditions. A 1% prasm gain offsets a 10 cent increase in jet fuel.
AAMRQ holders are obviously betting on a LCC stockholder approval ... otherwise their holdings would be down in buck area.