CAL UP 4% IN PREMARKET TRADING

CAL is up 4% in premarket trading. Many of its fares are up much more. The following list shows the price of flights last year and this year from Houston.

Memphis $198 to $663
Charleston $138 to $412
Detroit $188 to $476
Las Vegas $298 to $410


It should be noted that routes that compete directly with low cost carriers have not increased nearly as much. That of course is the reason several of the low cost carriers have gone out of business. In total, there have been 13 increases so far this year with a maximum increase of $340.

Obama has adjusted his foreign policy again. He has made it clear that he would not take the military option off the table and his talks with Iran would only be for the purpose of explaining the US position. The Iranians know that the USA is more than ready to met to fully explain our position as soon as Iran suspends development of nuclear fuel. They do not have to commit to stopping forever but long enough for each side to present their sides. Each side has already presented complete offers. The US in conjunction with the permanent UN security council members and Germany have delivered complete offers and amended offers over the past couple of years. There is no room for compromise on the development of nuclear bombs by a nation that has expressed its desire to wipe Israel off the map.

STRONG NUMBERS

The job market numbers this morning were strong. There is no recession in the USA, however, the cutback of imports by the USA and Australia are hitting the emerging growth countries hard. Vietnam is just one of the emerging growth countries that are being pounded by higher fuel and food prices. Like Lamar noted some months ago, it appears that we will have a rotating slow down in which the slow down in the USA will be over by the time other economies slow. It is part of the natural cycle for emerging growth countries to get hammered during the second half of the business cycle.