Who Bought the Put Options on Airline Stocks Shortly Before 9/11?

Tucker Carlson's "The 9/11 Files" is a true and preposterous black comedy about a fantastically rotten government.

If a screenwriter were asked to write a script about a rotten to the core government—a government that lies in the most ruthless and cynical away about everything all the time—he wouldn’t dare write the true story of The 9/11 Files out of fear that the audience would think it was too over the top.

Whoever was running foreign intelligence for the Clinton and Bush administrations must have possessed complete confidence in the perfect naivete of the American people. At this point, I’m beginning to wonder if Osama bin Laden was—wittingly or unwittingly—used as a bogeyman by Saudi, American, and Israeli intelligence agencies and whatever interests those guys represent.

A fantastically vulgar detail in Episode 4 is the fact that someone purchased a substantial number of put options on airline stocks shortly before the 9/11 attacks. Who purchased them? Our own government won’t tell us!

A put option gives the buyer the right, but not the obligation, to sell an underlying asset (like a stock) at a specified price (the strike price) on or before a certain date (the expiration date). The seller, or writer, of the put option receives a payment called a premium and is obligated to buy the asset if the option is exercised by the buyer. Put options are used by investors to protect existing holdings, profit from a stock price decline, or buy a stock at a lower price by selling a put.

In my younger, more fun loving days, I occasionally bought out-of-the money put options on stocks when I had a foreboding that bad news was coming for a particular stock or industry. Most of the time I was wrong and lost my premium, but on a couple of occasions I was right. For a young adrenaline junkie, there is nothing like seeing a modest investment in a put option increase 10X even 20X in one hour.

If you—for some reason—had foreknowledge of 9/11, you could have—a few weeks before the disaster—purchased puts on American Airlines and United stock, which were both were trading around $30 per share in August 2001.

If it were me and I had zero conscience, I would have purchased a ton of puts at a strike price of $20—a price so wildly out-of-the-money that the premium price would have been a pittance. Again, presuming I had zero conscience, the only thing I would worry about is that the SEC and Feds would soon be knocking on my door, asking me how in hell I apparently knew that the stock of United and American would soon get cut in half. However, it seems that for some privileged financial players who are still being protected by the U.S. government, the rules don’t apply. These players were allowed “to make a killing” with impunity.