love to see this truly advanced stage of capitalist development, where firms recognize the true profitability comes not from doing the thing that creates the good or performs the service... but instead turns into a mechanism for the development of financial products.
some pod I was listening to brought up how airlines make more money on their credit cards than their airlines. can't wait to see everywhere become a bank offering their own boutique financial services to access their goods and services. a highly efficient use of everyone's time and effort.
The financial services arm of many large companies, from Ford, to IBM, have long been the most profitable line of business. Like, 20 years plus .
People will bash you to death over a few dollars on the sticker price, but only a few quibble over 0.1% on the loan .
Who could have ever thought that the most efficient form of monetary gain was an M-M exchange?
Look man i'm just trying to buy a chimichanga, do you take Jimmy John's credit or not? No? Just Subway and Firehouse Subs? Look I think I have a bit more left on my Quiznos card, could you take that? I JUST WANT A FUCKING CHIMICHANGA
you may not transfer your earned points for cold drink upgrades as a member of the Subway Conductor Platinum club to any other sandwich tier and if you do not lower your voice, i will summon the restaurant police and they will escort you away from the service counter with extreme prejudice where you will lose your club membership and forfeit all earned points. and this will go on your credit report and your name will appear on the national Do Not Feed list.
Airlines have credit cards? Do you mean like reward programmes or literal credit cards? If the latter, what's the point?
literal credit cards.
here's an article (aimed at the capitalist/investor class) about what they call "co-branded" cards and their "value"
https://www.tdsecurities.com/ca/en/co-brand-implications-for-airlines-credit-card-issuersAirline co-brand credit cards have become increasingly more important to the airlines, which appear to have more leverage than the card issuers. The economics to the airlines from these programs are also typically based on revenue sharing, which is in their favor.
We believe airline loyalty and co-brand credit card programs are undervalued in the market. One U.S. airline has disclosed that their co-branded card contributed U$6.8B in 2023 revenue; and the company management believes this can grow to U$10B by 2030. We expect to see other airlines making earnings contributions from co-branded credit cards available during investor days later in the year.
here is a nerdwallet review with recommendations for 5 different credit card lines offered by United Airlines (scroll to the recommendation after the Chase Sapphire card)
https://www.nerdwallet.com/best/credit-cards/united-airlines-cardsthe value proposition, as i understand it, is loyalty within an airline network. the cards generally come with travel perks, like access to swank dining lounges in certain airports where there are tons of comfortable seats with chargers, free food and drinks. i traveled with someone who had one and they could get us all in with their membership. it was ridiculous. all i could think was how the entire airport could be like that, except they make the rest of it shitty on purpose.
and of course the "points" towards travel and upgrades, which are often 2-5x when spending money at the airline. the first article discusses in more detail what the airlines get out of it, but generally rewards programs tend to induce more frequent purchasing especially because points can expire. not to mention, they can be shifted to induce making reservations during times where demand has slacked. and the very "best" cards have annual fees, which more or less offset any of the costs of the perks for a typical traveler.
you have to be a pretty hardcore, big spender to really churn the shit out of those programs to make your money back... and at that point, you're probably exactly the kind of customer the airline wants to lock in. not to mention, you'll push others who travel with you be on your flight, probably, if its family etc.
thanks for the explainer. do you think the average person is supposed to understand this? or is the whole idea to confuse people so they get ripped off?
revolving lines of credit are generally rigged so that the user pays extra for the convenience or the perception of convenience. for every one user that is getting the most out of the deal, there are probably 9+ that are getting screwed.
especially in an economic downturn when more people tend to start carrying balances of unsecured debt at high interest.
it's so easy to slip off of good discipline and end up in crazy debt with these credit lines.
Ah, the peppeloani! Peppeloani! You know the peppeloani? The no one?
(source: a vtuber explaining how she eats her pizza in broken English)
Looking forward to a major economic crisis triggered by a crash in the subprime treat mortgage market
but have you considered given the current rate of inflation, paying over time will make your total effective cost like one tenth of a cent cheaper?
im not sure im good enough at math/finances to reason this one out, but surely that only matters if you're utilizing all of your available money, right? like if you have a buffer of money sitting in your savings account not doing anything, then paying now vs later doesn't actually matter because any amount you save is still just sitting in the savings account losing value the same way the price of the pizza is, right? but then i guess if you only have exactly as much in your saving's account as you've decided is your emergency fund / spending money and every single penny is otherwise in stocks or whatever, then it could be more efficient to pay for stuff in interest-free installments?
i know you're just fucking around but it's a fun question to try to grapple with anyway
If your savings account is interest bearing, theoretically you'd be ahead by the amount of interest generated by the price of that pizza that you can defer paying until later.
In practice, you'll lose out because most loans come with a one-time establishment fee or something.
If you don't pay the bank will repossess the leftover pizza in your fridge
can I buy, short, and trade in futures and derivatives of other people's financed pizzas?Having my bot farm inundate reddit with "I like this slice!" as my sold put contracts bury the Papa Murphy bears.
Times must be tough for shitty middle managers if they have to finance the pizza parties none of the employees want.
Here's what will really bake your noodle: in a sane society that pizza would be free along with other foods because it's a human right.
I have mixed feelings on this. I personally think that the most effective implementation of this is to make staple foods free, and I think pizza can be considered an American staple food. But I think making all food free is kinda like taking "let them eat cake" as actionable policy. It makes much more sense to make stuff like eggs and dairy and chicken and corn free imho.
The reality of this would be determined at the time of a socialist group taking charge of society and being able to enact these reforms; and would thus be decided by the material reality of that time. In reality socialist policy in the past has simply been to massively reduce the price of these staple goods, and this does well to prevent hunger.
pizza time never ends