SIMPLE QUESTIONS: SIMPLE ANSWERS

In what ways does the death of the terrorist leader in Iraq help the prospects for international air travel?

Does it marginally lower the perceived risk of international travelers? Does it marginally lower the risk premium built into the price of oil? Does it potentially hasten the resumption of oil exploration and development in oil rich Iraq? Does it embolden the Iraq government or demoralize other terrorist?

Answer to all: Buy AMR and CAL!

Last week, CAL ordered 34 new Boeing planes. The 737's will be delivered in 2008 and the 787's will be delivered in 2009. CAL could use the planes now to help fill burgeoning demand. By 2008, these planes will be packed like sardines. However, CAL has won award after award for providing the best flying experience for the business traveler. The company is doing a great job in a difficult situation. No other industry has been put through the ringer as much as the airline industry. It will probably always be a highly cyclical business. The smart investor will ride the good times and there has never been a time of higher relative demand.