Originally Posted by Bucking Bar

This chart probably shows better and more easily the running argument Sailingfun and I have, which has turned ugly as of late.

Nothing I've seen suggests anything other than jobs and travel demand track hand in glove. While it is true that reducing capacity has driven up revenue ( just as it did a Northwest ), there is a back side of the power curve where capacity reductions both drive up costs and reduce demand ( just as it did at Northwest ). The same managers are following the same play book.

My question has been, and continues to be, where is the bottom?

Not that there are not signs of life. Bringing flying back to mainline is a great sign, as is the investment in our mainline fleet. I argue in favor of doing more. A 10% margin is wonderful, but an 8% margin is good.

Let us not walk past a good margin by trying to squeeze a historically high margin. Capacity discipline is good, but I disagree fundamentally that capacity reductions are long term leverage.

At least over recent times our partner Air France / KLM proves my point. Despite the real mess Europe is in they have continues increasing Capacity AND Revenue according to their numbers released today.