Agreed. Of course we are in a very much new reality of fuel prices. Here we sit in the midst of the worst economy since the big bang or whatever, and fuel (oil actually, but you get the correlation I'm sure) is happy pushing 90. Every little ray of hope economic report that comes out pushes crude up, even in these economic times. Immagine what a full blown recovery would do. 100-120 will be the new norm" if there is ever a sustainable recovery. Expect higher if we keep printing money, which it appears we will.

That's a perfect segway into the other side of that equation...interest rates. We are pursuing the politically easy (time tested and failed) method of Japanese multi-decade low to no interest rates in the hopes that will magically cause growth. It clearly won't work, but even if it does, the bottom line is we will still have super cheap interest rates. When rates finally do start to go up by any significant ammount, manufacturers will simply get other "stimulus" scams from their misguided patriotic governments to grease the skids with lower purchase prices or better financing terms. Boeing will do it through the bottomless pit of defense spending on a different balance sheet, Airbus will do it through flat out subsidies, and of course Canadair and Embraer will do the same. And China is, well, China. They will do whatever they want to do and laugh at our cries of unfairness. We will threaten a trade war (policy of mutual economic destruction) but we won't have the clout to pull it off and they know it.

The "world courts" will stay busy, of course, as each points the finger at the other and squeals about unfair pricing or credit schemes but little to nothing will be done. What that means to our original pricing paradigm is that fuel is high and will stay there or go higher. Interest rates are low and will stay there. That will put strong pressure on airlines to renew their fleets whenever a 10-15% or more bump in effeciency comes along. At least, as long as the price is right. And it will be.