Jet Canceled - [was Re: Re: Bailed Out Citigroup Stimulates French Economy By Purchasing $50 Million Corporate Jet]

[David Farber <dave () farber net>]

Begin forwarded message:

From: Lauren Weinstein <lauren () vortex com>
Date: January 27, 2009 12:21:18 PM EST
To: David Farber <dave () farber net>
Subject: Jet Canceled - [was Re: [IP] Re: Bailed Out Citigroup  
Stimulates French Economy By Purchasing $50 Million Corporate Jet]


Dave,

After a reportedly strongly worded phone call yesterday from the Obama
administration, Citigroup is apparently now canceling delivery of the
luxury jet under discussion.  But it's sad that it required such a
call to inspire Citigroup to do the right thing.

http://abcnews.go.com/Business/Politics/Story?id=6740011

--Lauren--
Lauren Weinstein
lauren () vortex com or lauren () pfir org
Tel: +1 (818) 225-2800
http://www.pfir.org/lauren
Co-Founder, PFIR
 - People For Internet Responsibility - http://www.pfir.org
Co-Founder, NNSquad
 - Network Neutrality Squad - http://www.nnsquad.org
Founder, PRIVACY Forum - http://www.vortex.com
Member, ACM Committee on Computers and Public Policy
Lauren's Blog: http://lauren.vortex.com

- - -

On 01/27 11:46, David Farber wrote:
> Begin forwarded message:
>
> From: "David P. Reed" <dpreed () reed com>
> Date: January 27, 2009 7:48:03 AM EST
> To: dave () farber net
> Cc: ip <ip () v2 listbox com>
> Subject: Re: [IP] Re:    Bailed Out Citigroup Stimulates French  
> Economy
> By Purchasing $50 Million Corporate Jet
>
> The financial firms, having been "bailed out" seem to operate by
> different notions than the rest of the corporate economy.  At least  
> two
> major Fortune 100 tech companies I have personal experience of have
> *completely* stopped normal travel in the severest travel freezes I  
> have
> seen.  This decision to continue to believe in way above first class
> travel (penalties are not *that* big in contracts) is not careful
> husbanding of assets on would expect from compainies in tough times.
>
> Tough times call for tough decisions.  And sometimes deciding that for
> the long term, outsize bonuses and private jets are "out" is wise
> management.
>
> Not "bastards", just folks who must be completely out of touch with
> reality.
>
> David Farber wrote:
> > Begin forwarded message:
> >
> > From: Jonathan Stade <jstade () mtroyal ca>
> > Date: January 27, 2009 1:22:41 AM EST
> > To: dave () farber net
> > Subject: Re: [IP] Re:   Bailed Out Citigroup Stimulates French  
> > Economy
> > By Purchasing $50 Million Corporate Jet
> >
> > David Farber wrote:
> > > From: Lauren Weinstein <lauren () vortex com>
> > > > http://consumerist.com/5139484/bailed-out-citigroup-stimulates-french-economy-by-purchasing-50-million-corporate-jet
> > > Dave, once we've moved the current batch of residents out of  
> > > Gitmo, I
> > > have an idea for how we can use that expensive prison facility at
> > > Guantanamo to make a group of well-heeled Wall Street suits  
> > > seriously
> > > uncomfortable.
> > >
> > > But no torture/enhanced interrogations!  After all, these financial
> > > wizards only helped to wreck the global enconomy while lining their
> > > own pockets and taking taxpayer handouts.  Well, OK, maybe just a  
> > > few
> > > stress positions to keep them "on their toes ..."
> > >
> > > Bastards.
> >
> > If one clicks through to the original NYPost article
> > (http://www.nypost.com/seven/01262009/news/nationalnews/just_plane_despicable_152033.htm
> > ), which has a slightly higher standard of journalism applied to the
> > writing, one finds a couple important facts which are skipped in the
> > Consumerist posting:
> >
> > a) the decision to purchase was two years ago, "Citigroup decided to
> > get its new wings two years ago, when the financial-services giant  
> > was
> > flush with cash, but it still intends to take possession of the jet
> > this year despite its current woes, the source said."
> >
> > b) Citiflight is at the same time trying to sell off two of its  
> > Falcon
> > 900EXs, valued at approximately $27M each.
> >
> > If two years ago means 2007, then the purchase price was likely not
> > $50M, probably more around $41M (cf.
> > http://www.flightglobal.com/blogs/flight-international/2007/05/onboard-the-7x.html)
> > , and perhaps even lower if the commitment was 2006.
> >
> > Given that cancelling a contract of this size usually will involve
> > fines for default, it certainly isn't clear that taking possession  
> > is a
> > bad financial decision. In a slightly perverse argument, selling two
> > planes for $54M while buying one for $41M, thus avoiding a big
> > cancellation fee and reducing maintenance costs from two older planes
> > to one new plane could actually be called a cost-cutting measure.
> >
> > I know the Gitmo comments were in jest, but... too soon for me to  
> > find
> > humour in it.
> >
> > ~Jonathan Stade
> >
> >
> >
> >
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