ACL: "So do you get it now? They don't serve sushi! And for crying out loud, last time. On August 9th Delta and UsAir filed their statement of issues at the U.S. Court of Appeals in D.C., case number 10-1153. No, keep the dog on your side. He needs one of those cone things by the way. Anyways, they said the FAA’s conditions for approval of the slot swap between Delta Air Lines and US Airways would deprive them of their constitutional protection against the government taking property for public use without “just compensation." Their raising of that issue could compel the court to clarify whether slots are airline or government property, which has been a point of contention for years and has important government policy and airline business implications. Slot ownership, for example, was a key point of contention in 2007, 2008 and 2009 when the FAA and U.S. Transportation Department (DOT) proposed, and ultimately abandoned, a plan to auction off slots at the three major New York metropolitan area airports. You're not listening are you?"
80: "No."
ACL: "Okay, I'm done, I've got nothing to say. What do you want to talk about?"
80: "I just wanted to say that today one contrarian investor initiated a three-legged bullish options combination play on Delta Air Lines today with shares of the underlying stock trading lower by 6.25% on the day at $10.65 as of 12:55 pm E.T. It looks like the trader is betting Delta’s shares are not likely to fall much lower ahead of expiration in January 2011. The investor sold 4,000 puts at the January 2011 $10 strike for premium of $1.17 each, shed another 4,000 puts at the lower January 2011 $9.0 strike for premium of $0.80 apiece, and finally purchased 4,000 calls at the higher January 2011 $12.5 strike at a premium of $0.98 a-pop. The transaction yields a net credit of $1.00 per contract to the investor, which he keeps in full as long as the airline’s shares exceed $10.00 through expiration day. The long stance in call options implies the potential for additional profits to be made should DAL’s shares surge 17.4% over the current price of $10.65 to surpass the $12.50-level ahead of expiration in January. If shares continue to descend, however, the investor could wind up having a total of 800,000 shares put to him in the event both chunks of puts at the January 2011 $10/$9.0 strikes land in-the-money at expiration."
ACL: "Do you want to see pictures of lizards humping?"
80: "Yes."
ACL: "Why?"
80: "Because it makes me laugh..."