American Express received permission this week from the Federal Reserve to in essence, shift from being merely a credit card company to becoming instead a full-fledged bank. The move is being made so AMEX can get in line and put its hand out for some of that 700 billion dollars in federal bailout money.
Maybe AMEX wouldn't be in the crapper if it was more selective about the customers it goes after, and if it didn't give away the store in an effort to generate more business!
I received an offer in the mail this week for an American Express gold card. If I signed up and spent 500 dollars on the card between now and the end of January, AMEX would give me 50,000 Membership points - enough to cash in and receive 500 dollars in gift cards. Plus - the 150 dollar fee for the Gold card would be waived for the first year.
Now, I do have excellent credit, but I haven't had a regular job in nine months, so I was a bit concerned my application would be turned down. Silly me. When I went on line to apply for the card, and declared myself "self-employed", that was enough for AMEX. My application was approved in a few seconds, and the card is now on its way.
I will easily spend 500 bucks over the holiday season (we need a brake job for our minivan - that'll eat up most of it right there), receive my points, pay the bill (on stuff I would have bought anyway) and cancel the card. AMEX will be out 500 bucks, and I'll get a nice little prize essentially for free.
I know this will work, because we received the exact same offer at this time last year, except it was in my wife's name. We spent exactly 504 dollars, paid the bill, cancelled the card, and received two roundtrip tickets on Southwest Arilines AND a 50 dollar gift card to the Cheesecake Factory. Our friends, the Bernsteins received the same deal and did the same thing.... Now imagine how many other people did what we did.
Is it any wonder American Express is now asking the government for help? Maybe if it didn't give away so much money, it wouldn't be in such dire straits!
Not that I'm complaining!