Originally Posted by SharpestTool

The 4833 you referenced yield an annual compounded increase of 6.85% over the duration of the contract from our original C2012 amendable date to the future amendable date. At that rate DAL pilot pay will double in 10.5 years. Assuming inflation remains at current levels, would you be happy with double your current pay rate in 10.5 years?

Lets say we ink another 4833 for contract 2015. Lets further assume we ink the deal 6 mo.s early as we did last time. The math says that is another 6.85% compounded annual increase over 3 years. Rough calculation says M88A (largest category at DAL) pays out around $252. Add on 15% 401K contribution, we get $290. Doable? Absolutely! Is it enough?

Let's keep going.

Another 3 years, $307 for a pay rate and total comp rate of $353.

Isn't compounding math fun? Let's look at the other side of the coin. Can Delta generate an annual compounded profit increase of 6.85%? Sure. The question is for how long? Can we increase our comp at 6.85% annually? Sure, we have demonstrated that. For how long?

Clearly the answer to those questions is not forever. We know this intuitively. Enough is a question that depends on how one sees the world. A linear view reveals quite a different result than a cyclical view. Exponential growth requires cyclic adjustment. Linear growth is far more stable and allows time for productivity to keep pace.

Time is the key element. 4833 as one time deal over a 3 year period is not particularly exciting. 48334833 over 6 years gets the blood flowing a bit. 483348334833 over 9 years is quite an eye opener that gets one's pulse going real good.

Would you sign off on a such a 9 year contract, assuming inflation remains at current levels? I know, ridiculous, but it's a thought experiment. I would in a heartbeat. There is virtually 0 chance DAL will grow profitability at that rate for that period of time.

A more reasonable question, and still a thought experiment, would you sign off on 4833 commencing Jun 1 2015?

I think 4833 is highly doable and likely a lower bound. Interesting.