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On Thursday, Alpha Media Group announced that it was closing Blender magazine. The periodical, which specialized in music reviews, employed thirty people. Some will be moving to Maxim and other Alpha publications.

To a certain extent, it isn’t all that surprising to hear that Blender is closing. Amid tales of tanking newspapers and plummeting periodicals, the failure of yet another magazine is hardly noteworthy. Beyond that, I often hear my wife, a Blender subscriber, snarling at the magazine as she reads its reviews; I have to assume that any publication that regularly antagonizes its core audience has a questionable future.

There’s a big gap between the amount of money that the government needs to bail out the banking system, on the one hand, and the rapidly-dwindling amount of TARP funds that it has available for that purpose, on the other. Hence all the leverage in the bank-bailout scheme. But doesn’t it then make perfect sense for all the banks which got unleveraged TARP money back in October to give it back as soon as possible, so that it can then get levered up by the PPIPs and reinjected in beefed-up form back into the financial sector?

Rick Newman, for one, thinks so. But even he is alive to the downside, as explained by Andrew Ross Sorkin:

If Goldman succeeds in returning our money, it could put pressure on other banks to give their money back, too, lest they appear weak…
The problem now is that many of them may still need the money. And yet they may try to follow Goldman’s lead.

Newman reckons that if a bunch of insolvent banks will fail upon trying to give back their TARP money, so much the better:

It’s time to identify the weakest banks and let them fail if they can’t make it on their own. Capitalism isn’t like an elementary-school soccer game, where nobody keeps score and everybody wins just by participating. It’s a Darwinian ecosystem where the threat of extinction forces organizations to adapt and make smart decisions in order to survive.

The problem is that bank failures have systemic consequences. Newman is alive to the problems associated with another Lehman, but he seems to be oblivious to the problems associated with another WaMu: the US banking system can’t easily afford the cut-off in wholesale funding that would be associated with another large group of senior unsecured bondholders losing substantially all their money.

The prize, here, is to keep the financial system alive. And right now it’s simply too interlinked to be able to cope with a substantial number of bank failures. I think that handing back TARP funds is a good idea — but only insofar as it can be done without endangering the system. Otherwise, it’s a step in entirely the wrong direction.

The Citibank PremierPass credit cards offers higher point earnings for frequent travelers, but comes with a steep annual fee.  And, most cardholders were recently nailed with a steep increase in interest rate even if they had good credit.  Do the PremierPass Pros outweigh the Cons?

Earn Points Citi Premier Pass Card

The basic Citibank rewards points earning chart looks like this.

• 2 ThankYou Points earned for ever $1 spent at Grocery Stores, Gas Stations, Drugstores, Parking, and Public Transportation like subways.
• 1 Thank You Point earned for all other $1 spending.
• 1 Thank You Point earned for every mile flown on any airline, including other people whose tickets you bought with the card.

ThankYou Points Redeem Chart

* Since there is no fixed flight option anymore, I tested a couple of flights through the booking system and it appears that tickets are pricing at approximately 100 points per dollar.

Reward Value is average unless you maximize shopping at the 2 for 1 points locations.

Thank You Points Earned For Flying

Of course, the value of this particular card is not in its spending rewards which are mostly average, but rather in the value of getting ThankYou Points for flying on any airline.

If you few from Denver to Chicago, that is 903 miles, or 903 points earned for flying.  A round-trip ticket makes it 1806.

If you make that trip one a month for a whole year that is 21,672 ThankYou points, enough for a $210 plane ticket, and that is without using any of your points earned without flying.  In this case, the $210 reward will cover the $75 annual fee.

To put it another way, you have to fly at least 7,500 miles per year to cover the cost of the annual fee and turn this credit card from a money loser into a break-even rewards card.

Citibank Rewards Cons

Citibank ThankYou Rewards recently ended their fixed point option for flight ticket rewards, so budgeting the points is now tougher.  In order to find out how much a flight costs, you have to log into Expedia via the ThankYou Points website and enter flight information like you were going to buy a plane ticket online through Expedia.  What you get back are trip prices in points instead of dollars.

The major drawback of this process is that the online travel agencies are well known for a scam which involves changing the price at the last minute before you buy a ticket.  They get away with this by saying that the system you are looking at is just the reservation system and that it might not be up to date.  Only when you enter your credit card information does it check the real system that has the actual fare you have to pay.  So, the price can suddenly go up once you try and actually book the airfare.

For rewards this is particularly unpleasant because after you’ve carefully crafted a travel plan that allows you to use your points for a vacation for 2 to Hawaii, you’ll suddenly be informed that the flight is going to cost you 44,000 points instead of 38,000 points.  Multiply that across 2 tickets and you can see how big of difference there is between 88,000 points and 76,000 points.

Annual FEE and Expenses

$75 annual fee is terrible on virtually all credit cards, but frequent travelers might make it up with this card.

Interest rate is quoted as 13.24% Variable, but many customers with 740+ credit scores reported getting their rate increased without cause to over 16%, so beware about the Citibank credit card interest rate quotes.

Is Citi PremierPass Credit Card Worth It?

The answer for all credit cards with an annual fee is NO.  In this case, there can be some value here but only if you travel a lot.  The extra 1 point per mile flown can add up quickly for frequent travelers.

Difference Between Citi PremierPass and Citi PremierPass Elite

There is a Citi PremierPass basic card (non-Elite).  It has no annual fee, but is a basic, no frills, reward card with a standard 1 point for $1 point earning schedule.  You do get 1 point for every 3 miles you fly on tickets you buy with the card, but that won’t add up to much unless you fly a lot, in which case you are going to be better off with the Elite card.

Find a more robust card if you aren’t going to go for the elite level on this one.

Yet another ignominious distinction for the U.S. labor market: Continuing unemployment claims surged 122,000 to a record 5.56 million, the U.S. Labor Department announced Thursday, as more Americans found it hard to find comparable employment amid the nation’s worst economic downturn since the 1981-82 Reagan recession.

Meanwhile, initial jobless claims increased 8,000 to 652,000 for the week ending March 2. Initial jobless claims have now been above 600,000 for two months.

In classic Keynesian theory (the view basically espoused here), when the typical person’s daily life improves, the economy is strengthened, corporate capitalism is strengthened, and the American system goes about its merry way. Jobs. Business formation. Innovation. Ingenuity. Efficiency. Rising revenue. Rising earnings. Rising incomes. Happy families.

But when the reverse occurs, the opposite is true.

I didn’t always see things this way. But in graduate school, I detected a flaw in business management theory. Namely, that when labor costs go up, that’s always bad for business and corporate earnings; and conversely, when they go down, that’s always good. Further research and case studies would reveal that, in fact, once labor costs fall below a certain level, indeed very bad things happen to the economy. Among other negatives, the economy runs out of citizens with incomes adequate to sustain GDP growth, including revenue growth and earnings growth. Does this sound like any economy you know?

Is an increase in inflation in the cards for the United States? The inflation hawks certainly sense there’s inflation up ahead given the roughly $10 trillion in stimulus the U.S. government and Federal Reserve have provided to the financial system to address both the financial crisis and the recession. They are always at the ready to recommend a tighter monetary policy and offer amendment after amendment on the U.S. Senate’s floor to limit or reduce fiscal spending.

Further, China is so concerned about potentially higher U.S. inflation — and the impact it would have on its dollar-based investments (mostly bonds) — that it has recommended changing the international monetary system so that a global currency or a ’supercurrency’ serves as the world’s primary reserve currency, not the U.S. dollar.

One of the nice features of the Capital One Miles program is that you can both purchase travel with your miles, or you can get a “statement credit” for travel that you have already taken.  The great thing about this feature is that if you don’t have time to sift through the usual rewards catalog website and redeeming rewards process, you can just book your travel like you normally would, pay with your Capital One No Hassle Miles Reward card, and then use your points after the fact to pay for your trip.

Do it before your payment is due, and it is just like you went through the usual booking process to use your miles or points costing you no interest payments.

Capital One Miles Redeem For Travel Rewards Chart

The basic Capital One No Hassle Rewards card earns 1.25 miles per dollar except at bookstores, card stores, novelty stores, souvenir shops, arts & craft stores, florists, and video rental stores (not Netflix) where it earns 2 miles per dollar.  Unless you do some heavy spending at those places chances are your flight awards will be made up mostly of 1.25 miles per dollar purchases.

At that rate, the max ticket value for each category works about to $12,000 of spending or the equivalent of 1.25% cash back, which is better than your basic 1.0% cash back card.  However, be very aware of the sweet spot near the top of the range, and the dead zone at the bottom.  A $170 ticket or a $375 ticket will be a terrible deal.

Capital One Miles Rewards Good for Students

The Capital One travel rewards can be a great deal for college students.  Since students buy hundreds of dollars worth of books each year, they can really benefit from the 2 miles per dollar rate provided the campus bookstore is properly categorized.  To find out, make a small test purchase at the. campus bookstore and then go online to view the transaction.  If it is listed as a bookstore (or even card shop or novelty shop) then you are in business.  If not, check out the off-campus bookstore alternative that many college towns have.  If it is listed in one of the good categories then you can buy your books there.

Even better, most major university bookstores carry far more than just books, sometimes at bargain prices because of student pricing.  This is especially true for student edition software.  Online deal sites go nuts over the prices students can get on things like Microsoft Office or even Windows Vista or Windows XP.  Each of those purchases can get 2 miles per dollar.

A student spending $2,500 a semester in various bookstore purchases would qualify for a free ticket home for Thanksgiving every other year.  And if they let you charge your tuition or fees, then this baby is going to pay off in free plane tickets.

As always, responsible use of all credit, especially credit cards is vital to a solid financial future, so don’t spend just get miles.

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