And yet another reason never to buy an Airline stock. One of the best pieces of advice someone ever gave me when it came to investing was to never buy airline shares. Not that I ever would have but when I asked why, they said “because they always go bankrupt.” Over the years that theory has held true. I can remember when JetBlue (JBLU, $6.14, up $0.10) became a public company and shares zoomed in 2002 and 2003, splitting twice. Now look where the stock is.

Although Airline stocks can and do trade higher, I still follow the sector and will occasionally buy a call or put option if I think I can make some money. What was interesting with UAL Corp (UAUA, $10.92, down $1.38) yesterday was that the stock took a dive when a nearly 6-year-old news story on the 2002 bankruptcy filing hit the Internet.

The stock opened at $12.16 and was having a normal trading day when all of a sudden the story was making rounds in the marketplace. The stock hit a low of $3.00 and was halted shortly after 11:00 AM. Shares resumed trading at about 12:25 PM.

How this happened was a classic “wanna get away” commercial. It seems a reporter from Florida was doing some investment research and did a Google (GOOG, $419.95, down $24.30) search on something and saw a headline saying United Airlines was declaring bankruptcy. He took the story and ran with it. There was no date on the original article. The story got published, not only to subscribers of the newsletter he was doing research for, but also through Bloomberg terminals.

United Airlines, which emerged from bankruptcy in 2006, said it “demanded a retraction from the Sun Sentinel and is launching an investigation.”

It was a wild day for the stock but a honest mistake I suppose. Internet traffic for Sun’s website began to spike Saturday night and continued into Sunday. This was good and bad news for some investors. The chaos at United, the marketplace, with SEC regulators, and newsrooms cannot be described. If you were watching the stock halt on television then maybe you witnessed the drama. Although I did not participate in any option plays involving UAL, it just goes to show how Internet information can be used to our advantage.

Not only did it have an impact on UAL but you have to believe it also some affect on Google. The market took down Google after reports emerged that its mobile phone, dubbed Android, were getting disappointing reviews. The market has fallen out of love with Google but the company is a sleeping giant. I want to take advantage of this situation but it is risky. I told you the market was being cautious on Google but we can play a short bounce here. Take a look the Google September 460 calls (GOPIL) which closed at $1.85 yesterday. If we can get into them at $2.00-$2.25 we may be able to ride them higher for the rest of the week.

Rick Rouse