In the wake of the resignation of American Airlines(NYSE: AMR) CEO Donald Carty, we learned of a more revealing story about the dismissal of two Southwest Airlines pilots (NYSE: LUV).

A male pilot and copilot were fired earlier this month for flying au naturel. Yep, in the buff. In their birthday suits. Allegedly, the men took off all or most of their uniforms in the cockpit, an action the airline deemed "inappropriate."

The pilots are appealing their termination, claiming they removed their clothing after spilling coffee on themselves.

Sounds legit to us. In fact, after someone spilled coffee in the Fool HQ kitchen, our entire editorial staff worked without pants today.

In today's Motley Fool Take:

American's CEO Grounded

Has American Airlines(NYSE: AMR) been listening to our own Bill Mann? You have to wonder, following last night's forced resignation of chief Donald Carty.

Gerald Arpey, American's chairman, will take up the reins as new CEO, and Edward Brennan, a current American director, will serve as chairman of the board.

Union leaders seem pleased that Carty is leaving. Gary Boettcher, head of the Washington division of American's pilots' union, was quoted in The Washington Post as saying, "Carty was not personable -- he was ruthless. He was a very tough negotiator, and nobody believed anything he said. Arpey is a man of integrity. We can stand by his word he will do what he thinks is best for the company."

We hope the unions' optimism is rewarded, but here's the rub: Do you really think Carty was acting completely alone in the now-infamous executive bonus shenanigans? Please.

The problem's systemic. Carty was the guy unfortunate enough to take the heat and the fall for it, but there's no way he was the only guilty executive. Are we really to believe that Arpey was genuinely trying to convince Carty not to protect his big, fat bonus and pension plan? As Bill Mann said, "What we have here are deep character flaws in the executive team at AMR, ones that were both tolerated and encouraged by a non-interventionist board."

That same executive team and non-interventionist board is still running the show. They've obviously tried to take a stand and make a significant statement by booting Carty, but don't be wooed so quickly. American's leadership has proven itself worthy of intense skepticism.

This afternoon, employees looked past their differences and accepted concessions that, for now at least, should stave off bankruptcy.

Quote of Note

"The strength of the turbulence is directly proportional to the temperature of your coffee." -- Gunter's Second Law of Air Travel

Amazon Amazes Again

Turn the page. That's the best piece of advice you can give the ever-shrinking crowd of AMZN) pundits.

While cynics figured that the debt-laden and formerly profitless online giant was destined to file for bankruptcy, the company has gone on to thrive and write new and exciting chapters in its corporate life.

Amazon posted a billion-dollar quarter in revenue for the March period. Yes, that's $1.1 billion in sales for the March quarter. This isn't the holiday season, where last-minute procrastinators and folks suffering from mall-o-phobia turn to the Web-based merchant for gift ideas. These are folks who know they can park at the local strip mall and that there's plenty of time to head out into the real world to shop. And they're still choosing Amazon.

With more and more merchants teaming up with Amazon to run their online storefronts and the widespread familiarity of the site's convenience, attractive prices, and free shipping options, Amazon has grown its traffic and made a bit of money along the way.

It's now expecting to produce $4.7 billion in revenue this year on operating profits of $275 million. No, it's not going to be a high-margin powerhouse. Amazon deals in hard goods with actual costs. And while its marketplace offerings and merchant alliances may have a whiff of the fat-margin scent, like popular dot-com survivors eBay(Nasdaq: EBAY) and, at times, Yahoo!(Nasdaq: YHOO), Amazon is still just a retailer -- but a behemoth that keeps getting bigger.

You've got to hand it to Amazon. Even that mountain of debt seems to be under control, as the company has paid off some of its borrowed greenery. Chapter 7? Chapter 11? Bah! Turn the page. There's a happy ending for this bookseller.

Discussion Board of the Day: Amazon

Are you a fan of Amazon? Where do you see the company in five years? Will it ever become a margin champion? All this and more -- in the Amazon discussion board. Only on

Seeking a Cure for SARS

Two drug companies are scoring big gains today on news that they're developing treatments for severe acute respiratory syndrome, or SARS. But there's more than one reason for investors to be careful here.

Medarex (Nasdaq: MEDX) jumped 12% after it said it entered into an agreement with the University of Massachusetts Medical School in which it hopes to co-develop fully human antibodies to the respiratory illness. Meanwhile, GenVec(Nasdaq: GNVC) has signed an agreement with the National Institutes of Health to begin development of a clinical grade vaccine for SARS. GenVec is up 75% today.

Neither company indicated how long it might be before the treatments would be available, assuming either made it through the testing and approval processes. Typically, procedures such as these take years.

It's also worth noting that neither company has any products on the market. Medarex lost $2.09 per share in 2002, and had negative free cash flow of $108 million. It currently has $350 million in cash and short-term investments. Meanwhile, GenVec dropped $1.17 per share and $22 million in free cash flow, while it has $18 million in cash and investments.

This is not to say these aren't exciting developments for these two companies. GenVec, for example, will receive $420,000 for its efforts. The point is that the odds are long that the treatments will even reach the market.

Investments in either -- especially based solely on the SARS developments -- can only be considered highly speculative.

How Much to Save?

Here at, we spend a lot of time talking about investing in the stock market. But that's for your long-term savings -- money you won't need for at least five years, right? Right! What about those unpredictable zingers life throws at you at the worst times? Why, that's why you need a stash of short-term savings. Let us tell you how to start saving today.

Quick Takes

Cosmetics company Avon(NYSE: AVP) posted a higher first-quarter profit today. The direct beauty products seller earned $98.9 million, or $0.42 a share. In last year's Q1, Avon netted $96.3 million, or $0.40 a share. Sales grew 7% to $1.47 billion. Looking forward, Avon said that the SARS virus is hurting its Chinese sales, and warned that it will miss the current-quarter earnings projection of $0.71. However, Avon did back its full-year earnings goal of $2.55 a share.

Merck (NYSE: MRK) has halted development of a new asthma and chronic obstructive pulmonary disease drug because of safety concerns. The drug was in mid-stage clinical trials. Merck didn't say exactly what the safety concerns were, but Celltech, the British company it was working on the drug with, said that one person in the study developed colitis. This is another blow to Merck's already weak drug pipeline.

Discount giant Wal-Mart(NYSE: WMT) has named Tom Coughlin as its new executive vice president and vice chairman. Coughlin has been with the company for 25 years, and is one of the top executives who personally worked with Wal-Mart founder Sam Walton. In his new role as vice chairman, Coughlin will be responsible for global merchandise sourcing, real estate development, and logistics. He will also continue his present responsibilities for Wal-Mart's U.S. retail operations.

Mutual and index fund company Vanguard is imposing new exit fees on some funds in an attempt to stop market timers. The 2% exit fees will go into effect June 27 for Vanguard's nine international stock funds. Investors holding shares of the funds for less than two months will be penalized. Arbitragers have been taking advantage of time zone differences and the price differentials they trigger, causing Vanguard's international fund managers to buy and sell more frequently than they'd like. Gus Sauter, managing director of the Vanguard Quantitative Equity Group, said, "We believe that a short-term redemption fee will serve as an effective means of ending this adverse trading activity."

And Finally...

Today on

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Bob Bobala, Robert Brokamp, Mathew Emmert, Jeff Fischer, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Jackie Ross, Reggie Santiago, Dayana Yochim