““CEOs go to their vacation homes just after companies report favorable news, and CEOs return to headquarters right before subsequent news is released. More good news is released when CEOs are back at work, and CEOs appear not to leave headquarters at all if a firm has adverse news to disclose. When CEOs are away from the office, stock prices behave quietly with sharply lower volatility. Volatility increases immediately when CEOs return to work.” —David Yermack, a New York University finance professor, whose recently released study shows a correlation between when CEOs take their private jets on vacation and movements in their companies’ stock price ”
DayJet Folds, but Air-Taxi Operators Remain Hopeful
Per-seat, on-demand charter operator DayJet has ceased operation. The Boca Raton, Fla.-based company was in business barely a year, offering an air-taxi service covering much of the U.S. Southeast. DayJet blamed its September shutdown on its inability to arrange financing in the midst of the current global financial crisis.
Despite the economic crisis, however, other air-taxi operators remain upbeat. Speaking at a conference in October, Air Taxi Association president Joe Leader said worldwide demand is increasing for air taxis, which he defined as "more affordable on-demand transportation" than traditional aircraft charter. Linear Air president and CEO Bill Herp, meanwhile, blamed DayJet's failure on the fact that it didn't test the per-seat, on-demand model in a primary market like the Northeast. Herp said Linear Air is now doing that with its Eclipse 500s between Bedford, Mass., just outside Boston, and White Plains, N.Y., in the New York City metropolitan area.