I left a comment on MSN Smart Spending Blog. I am reposting that comment on my blog so that everyone can read what I think about American Express' recent $300 gift card offer to close accounts. Enjoy and leave a comment for me.
AmEx paying cardholders to close accounts
by Karen Datko
Remember the days when credit card companies used to reward people for signing up? Now, one company, American Express, is offering cardholders $300 to hit the bricks.
AmEx paints this offer as a way to help customers get control of their finances. We're not buying it, and neither is the blogger at CreditMattersBlog.com, who wrote, "The ‘we want to help you simplify your finances' language is a joke, of course."
Apparently AmEx is hoping that the customers who get this offer will take the hint: We don't want your business anymore.
If you get the "invitation" and decide to enroll, your account will be closed immediately. You also have to pay off your balance by April 30 or forfeit the $300 prepaid card. Any rewards points not used before you sign up will be lost. (See this AmEx Web site for other conditions.)
The deadline for enrolling is the end of this month.
As we've reported here, AmEx hasn't distinguished itself lately in the area of customer relations -- slashing credit limits, for instance. (Update: AmEx told The New York Times it will stop using "spending patterns" as a justification for reducing credit lines.) And there's a reason for that. Bloomberg reports, "American Express, which got $3.39 billion from the U.S. Treasury to boost capital, said last month that fourth-quarter profit from continuing operations fell 72% to $238 million as more consumers defaulted."
To stop that slide, the speculation is, it's offering cardholders a $300 incentive to make their AmEx balance a priority over other debt.
"What AmEx is trying to do is move to the front of the line in terms of getting paid back," Michael Taiano, an analyst at Sandler O'Neill & Partners, told Bloomberg.
AmEx won't say how many customers have gotten the $300 offer or how they were selected.
"I wish AmEx would make me this kind of offer. Instead, they cut my line from $15k to $4k, then down to $1k, in the span of a few months -- despite me paying the balance in full every month and never having a delinquency," said reader Bob at The Wall Street Journal's The Wallet.
Will this offer work?
"The glaring question here is whether the only people who will take advantage of this are the kinds of paying customers AmEx would like to keep for the long run," wrote Tom Petruno at the Los Angeles Times' Money & Co.
Dustbury.com said, "How many of these folks will come back to AmEx when times are better? Yeah, that's what I thought."
My Comment:
Over the past few years, Amex's customer service level went downhill. It has been an all-time winner of the best credit card company in the world. They have outsourced their customer service units and their e-mail response time now exceeds 24 hours. No matter what the critics say, we all know Amex is still the best credit card company as mentioned by the J.D. Power & Associates. Here's why: other credit companies slashed their service levels so much that Amex still shines out of them.
This $300 offer is one of the biggest management mistakes Amex has ever made. First of all, because of this offer, Amex's name was all over the media as a terrible company. Then, this offer will not work for sure. No wonder no other company is willing to follow its footstep. I have been a member of Amex since 2004 and make every single payment on time. Despite the recent credit line cuts by Amex, they have not cut my line. So, this is my point: that offer only went to cardholders who revolve their credit lines and their credit scores are below 680. Also, I know that those holders owe at least $1,500 on their cards. I actually wanted to get this offer and tried to ask for it. The answer was no. Now, you know they are keeping all deadbeats like me and want to get rid of revolvers. I highly doubt that people will pay off $1,500 for a $300 gift card because if they had the money, they already paid Amex back. Good luck finding cardmembers to pay off.
Thursday, March 12, 2009
Wednesday, March 11, 2009
Topoi
Dr. "Coach" has taught me how to use and apply topoi to the writing process. Honestly, I doubted whether it would help me to write better papers, but I later realized that it would really help me. Let's put it this way. Topoi has taught me how to apply different view points to my paper. His topoi tool has explanations on how to apply different lenses such as contrast, values, cause/effect, change and form/structure.
I applied the cause/effect lens to my topic, economic downturn. With the lens, I realized that I forgot to include college students who would face many uncertainties because of the downturn. Thanks to topoi, I added a paragraph addressing how the downturn has impacted new college graduates on their job search.
Wow,topoi is so great that I am now using it to develop my paper. Using topoi definitely helps me to write a paper that is not one-sided or biased. Try topoi and you will love it!
I applied the cause/effect lens to my topic, economic downturn. With the lens, I realized that I forgot to include college students who would face many uncertainties because of the downturn. Thanks to topoi, I added a paragraph addressing how the downturn has impacted new college graduates on their job search.
Wow,topoi is so great that I am now using it to develop my paper. Using topoi definitely helps me to write a paper that is not one-sided or biased. Try topoi and you will love it!
Tour of My Pageflake Page
Honestly, I am not computer-savvy. My friends would laugh at me if they found out I have my own blog. All I knew about computers is how to browse the internet and use some basic Microsoft Word and Excel applications. Then, my writing professor came to rescue this poor soul and taught me many tools that I can use for my research. My Pageflake page is the fruit of his excellent teaching. So now, let me introduce you to this wonderful world of Pageflake. Pageflake is a research aggregator where one can combine all his/her online research data in one place, including RSS feeds, annotations, web sites, and much more. I just began using my Pageflake and I am saving so much time since I am no longer browsing the web to check any updated article or post. All I have to do is go to my Pageflake and everything is there. Enough said, let me give you a tour of my Pageflake page.
RSS Feeds
On top of the page, I have Bloomberg TV for latest financial news and I have compiled my RSS feeds below. My RSS feeds provide numerous data about the economy, personal finance, and money. My favorite RSS feeds include MSN Money Top Stocks and Smart Spending . Unfortunately, both of my favorite feeds are having technical difficulties at the moment and I have added web pages for both feeds as well as a feed for MSN Money Latest Articles which includes all the latest posts from MSN Money blogs. These feeds provide up-to-date information on financial markets, the economy in general,real estate markets, and very useful personal finance articles. I found their commentary very helpful since they are willing to criticize instead of just summarize topics. L.A. Land is another feed I love to read since it covers the Southern California real estate market where my research is heavily focused, while other feeds mostly discuss the market on the national level. Even though these feeds cover an array of different areas, I have noticed that in recent months they are heavily focused on negative news. Whether I read L.A. Land or MSN Top Stocks, there is always news about the terrible housing market and its impact on our economy.
Zotero Bibliography
In addition to other research data, I have more than seven bibliographies that are located in a web site called Citeline. This is where I store all my annotations, and the advantage of having them online is that I can share them with others. I have written annotations for two books by Frederic S. Mishkin, who not only covers the fundamentals of the financial markets, but also the current financial crisis. It is interesting how the elements of historical crises in his book are also discussed in blogs that I subscribe to. My feeds are filled with the news of possible bank failures and according to Mishkin's books these failures are common during economic crises. Yes, history repeats itself and that is why we study theory.
Active Searches
On the left side of my page below my bibliography, I have added Universal News Search and Universal Blog Search widgets. These are great widgets offered by Pageflake, and when I enter my search terms, money and economy, I have found many great news and blogs that I am not aware of. I find these news and blog very helpful for my research and I will be adding them to my Diigo bookmark and RSS feeds.
Diigo Bookmarks
On the left bottom corner, I have placed my Diigo bookmarks. I find it very interesting to compare my Diigo bookmarks with topics on my feeds and search engines. Not surprisingly, they mostly have the same focus, the financial crisis and personal finance.
Social Bookmarking Soulmate
Right below my bookmarks, I have placed my soulmate's bookmarks. Honestly, I have not checked my soulmate's bookmarks for a while since I have not had time to look through his page. Now, since I have listed his page on my Pageflake, I can see his latest bookmarks without logging into Diigo. Guess what? I just found a great link to the Ludwig Institute from his page and I will use that for my research.
I am amazed how Pageflake has helped me explore other aspects of my research. Since I can now see all my sources on a single page, I can tell where the economy is heading by comparing all my sources and their latest updates.
RSS Feeds
On top of the page, I have Bloomberg TV for latest financial news and I have compiled my RSS feeds below. My RSS feeds provide numerous data about the economy, personal finance, and money. My favorite RSS feeds include MSN Money Top Stocks and Smart Spending . Unfortunately, both of my favorite feeds are having technical difficulties at the moment and I have added web pages for both feeds as well as a feed for MSN Money Latest Articles which includes all the latest posts from MSN Money blogs. These feeds provide up-to-date information on financial markets, the economy in general,real estate markets, and very useful personal finance articles. I found their commentary very helpful since they are willing to criticize instead of just summarize topics. L.A. Land is another feed I love to read since it covers the Southern California real estate market where my research is heavily focused, while other feeds mostly discuss the market on the national level. Even though these feeds cover an array of different areas, I have noticed that in recent months they are heavily focused on negative news. Whether I read L.A. Land or MSN Top Stocks, there is always news about the terrible housing market and its impact on our economy.
Zotero Bibliography
In addition to other research data, I have more than seven bibliographies that are located in a web site called Citeline. This is where I store all my annotations, and the advantage of having them online is that I can share them with others. I have written annotations for two books by Frederic S. Mishkin, who not only covers the fundamentals of the financial markets, but also the current financial crisis. It is interesting how the elements of historical crises in his book are also discussed in blogs that I subscribe to. My feeds are filled with the news of possible bank failures and according to Mishkin's books these failures are common during economic crises. Yes, history repeats itself and that is why we study theory.
Active Searches
On the left side of my page below my bibliography, I have added Universal News Search and Universal Blog Search widgets. These are great widgets offered by Pageflake, and when I enter my search terms, money and economy, I have found many great news and blogs that I am not aware of. I find these news and blog very helpful for my research and I will be adding them to my Diigo bookmark and RSS feeds.
Diigo Bookmarks
On the left bottom corner, I have placed my Diigo bookmarks. I find it very interesting to compare my Diigo bookmarks with topics on my feeds and search engines. Not surprisingly, they mostly have the same focus, the financial crisis and personal finance.
Social Bookmarking Soulmate
Right below my bookmarks, I have placed my soulmate's bookmarks. Honestly, I have not checked my soulmate's bookmarks for a while since I have not had time to look through his page. Now, since I have listed his page on my Pageflake, I can see his latest bookmarks without logging into Diigo. Guess what? I just found a great link to the Ludwig Institute from his page and I will use that for my research.
I am amazed how Pageflake has helped me explore other aspects of my research. Since I can now see all my sources on a single page, I can tell where the economy is heading by comparing all my sources and their latest updates.
Tuesday, March 3, 2009
Annotations for my research paper
Mishkin, Frederic S. Financial Crises and the Subprime Meltdown Boston: Pearson, 2009.
Federal Reserve Governor Frederic S. Mishikin's most recent book, Financial Crises and the Subprime Meltdown is a must-read book for those studying economics or anyone wanting to gain greater familiarity with the economic crisis. The current financial crisis is the biggest economic event since the Great Depression. Unlike other analysts and experts who only write about what is currently going on with the financial crisis, Mishkin explains the causes of the crisis and their international impact and implications. Mishkin relies upon a 3-step projection plan to reveal the current economic crisis (step 1:Asset price boom/bust; step 2: banking crisis; step 3: debt deflation). Furthermore, he also compares the current crisis with other crises in the past from around the world including an extensive analysis of South Korean and Latin American crises. Since he has intended this book for academic audiences, he describes the crisis at the advanced level including the discussion of collateralized debt obligations. Mishkin however may rely too heavily upon his research, and he avoids sharing his own interpretations. Compared to his previous books, Mishkin is now more focused on current events than the theory. Although directed towards academics, any curious reader can benefit from Mishkin's analysis of the economic crisis.
Mishkin, Frederic S. The Economics of Money, Banking, and Financial Markets Boston: Pearson, 2007.
Mishkin's best selling book,The Economics of Money, Banking, and Financial Markets covers topics from the structure of financial markets to monetary and fiscal policy. His book provides an in-depth understanding of the basics of our financial markets and how they operate. Mishkin wrote this book to answer most of our questions; he explains speculative demand for money by applying Keynes and Tobin's theories to support his assertions. Mishkin also covers the Great Depression, Savings and Loans Crisis, and other international crises in detail and they are very valuable tools for anyone who wants to compare previous crises with the current crisis. The highlight of his book is when he discusses how moral hazard influences the financial market, but instead of providing the real world example, he created a hypothetical example. Also, he answers the novice investors' most frequently asked question, "how the market sets stock prices?" When Mishkin answers this question, he heavily focuses on the dividend side of the valuation and he has fails to mention that the future earnings of a firm have an even greater impact on stock prices. Despite the highly academic nature of his writing, those who are interested in learning more about the background of the financial crisis and financial markets should read this book.
Bernasek, Anna. "When Does A Housing Slump Become A Bust?" The New York Times 17 June 2007: 6.
Bernasek, in her article, "When Does A Housing Slump Become A Bust?" discusses the definition of housing market bust. While we have the exact definition of a stock market crash and a recession, economists have not agreed on what constitutes a housing market bust. Bernasek claims that because the only national housing bust happened during the Great Depression and the market statistics are not clear-cut, economists have avoided this topic. I found her presentation of arguments between two economists about the definition of the housing bust very weak since she failed to convince readers by not interviewing more economists. Bernasek, however made a strong point that measured prices may not reflect the actual sales price and they underestimate the declines. Lastly, she argues that we may be able to agree on the definition of the bust during this downturn "as people would feel the pain." What kind of pain is she talking about? Her unclear conclusion draws a clear distinction between an academic journal and a mass media article. Bernasek's article will benefit those who study economics and those who are interested in the real estate market since she explains the challenge of identifying a clear definition of the bust and its ambiguity. Her article will assist me in supporting my argument that the fate of the real estate market is still unknown.
Roubini, Nouriel. "The Worst Is Yet To Come." Foreign Policy (2008): 63-68.
Nouriel Roubini, in his article, "The Worst Is Yet To Come," published in March 2008 (Foreign Policy), forecasts the negative economic outlook not only in the United States, but in the global economy. Despite the fact that asset bubbles burst throughout the world, he predicted that more bursts would happen in the near future. His arguments seem very convincing since he claims that the credit crunch will continue because of deleveraging by hedge funds and other institutional investors. Since the publication of the article, his claims have come true: the global financial markets have seen the worst deleveraging in human history. Roubini also predicted that commodities and credit-default swaps in particular would create further market bursts. Again, his infamous forecast shocked the world; the price of oil fell sharply and the bankruptcy of Lehman Brothers brought huge losses on credit-default swaps. Lastly, Roubini argues that the only way to avoid further economic downturn is agressive actions by policy makers. Although his predictions turned out to be accurate, he did not make any effort to use sources that would have made his statement more convincing. Today, however because Roubini is considered the only economist who predicted the subprime crisis, he does not need to cite others' work even though other scholars and journalists cite his work all the time. Roubini's article would benefit almost everyone in the world since his analysis can help us to plan our financial future.
Belke, Ansgar and Marcel Wiedmann. "Boom or Bubble in the US Real Estate Market?" Intereconomics (2005): 273-284.
Ansgar Belke and Marcel Wiedmann, in their article, "Boom or Bubble in the US Real Estate Market?" published in September 2005 (Intereconomics), question whether the United States real estate market boom that lasted until summer of 2006 was driven by expansion in the economy or just speculations. Belke and Wiedmann try to convince readers by presenting a wide array of sources including scholarly journals, web sites,official government data, and financial magazines such as The Economist. Also, graphs and tables showcasing house data add greater credibility to their article. Belke and Wiedmann express how they worried that a rapid increase in available credit to borrowers would cause significant problems should the economy begin to contract. Their worries came true and it is very interesting how we are paying the price for not following their recommendations. For example, Belke and Wiedmann criticize the US government for implementing monetary policy to control the housing market. They argue that instead of monetary policy, fiscal policy should be implemented. It is no surprise that the government is now placing a great emphasis on fiscal policy. Belke and Wiedmann introduce new terms such as a strategy of "leaning against the wind" and "negative feedback trading." They, however do not explain what "negative feedback trading" is and expect the readers to know what that is. Also, their usage of vocabulary is somewhat complex, using many technical terms such as "positive deviations." Despite some negative aspects of their article, policy makers and those who are interested in the current economic issues should read the article since it would help them to understand the underlying causes of housing boom and bust.
Kimble-Ellis, Sonya. "Real Estate Blues." Network Journal (2008): 28.
Sonya Kimble-Ellis, in her article, "Real Estate Blues" published in November 2008 (Network Journal), discusses the changing environment in the real estate market. Kimble-Ellis claims that real estate agents are having a hard time getting mortgages for their clients since banks have changed their lending requirements. Kimble-Ellis interviews a real estate broker who argues that the new lending requirements put a higher barrier to inner-city home buyers. When one begins to read this article, one should notice that Kimble-Ellis starts the article by mentioning African-American real estate agents when she could have just said real estate agents. She purposely emphasizes "African-American" to let readers know that this article will discuss the real estate market in minority's views. Kimble-Ellis explains the term, "short sale" in simple language so that readers who have not received any financial education could understand. She mentions that the No Income Verification Loan is available to certain borrowers; however, that loan type had completely disappeared right after the financial crisis started.It must be true that Kimble-Ellis has no knowledge in the real estate industry. Since she does not verify the information she has obtained, her article loses credibility.Kimble-Ellis, however makes an attempt to represent the views of the minority when other journalists only write about the mainstream. Thus,those who study about the current economic condition of the minority may find this article interesting. In addition, this article could be beneficial in sociology and economics researches since the article presents the issue of social problems and financial regulations.
Federal Reserve Governor Frederic S. Mishikin's most recent book, Financial Crises and the Subprime Meltdown is a must-read book for those studying economics or anyone wanting to gain greater familiarity with the economic crisis. The current financial crisis is the biggest economic event since the Great Depression. Unlike other analysts and experts who only write about what is currently going on with the financial crisis, Mishkin explains the causes of the crisis and their international impact and implications. Mishkin relies upon a 3-step projection plan to reveal the current economic crisis (step 1:Asset price boom/bust; step 2: banking crisis; step 3: debt deflation). Furthermore, he also compares the current crisis with other crises in the past from around the world including an extensive analysis of South Korean and Latin American crises. Since he has intended this book for academic audiences, he describes the crisis at the advanced level including the discussion of collateralized debt obligations. Mishkin however may rely too heavily upon his research, and he avoids sharing his own interpretations. Compared to his previous books, Mishkin is now more focused on current events than the theory. Although directed towards academics, any curious reader can benefit from Mishkin's analysis of the economic crisis.
Mishkin, Frederic S. The Economics of Money, Banking, and Financial Markets Boston: Pearson, 2007.
Mishkin's best selling book,The Economics of Money, Banking, and Financial Markets covers topics from the structure of financial markets to monetary and fiscal policy. His book provides an in-depth understanding of the basics of our financial markets and how they operate. Mishkin wrote this book to answer most of our questions; he explains speculative demand for money by applying Keynes and Tobin's theories to support his assertions. Mishkin also covers the Great Depression, Savings and Loans Crisis, and other international crises in detail and they are very valuable tools for anyone who wants to compare previous crises with the current crisis. The highlight of his book is when he discusses how moral hazard influences the financial market, but instead of providing the real world example, he created a hypothetical example. Also, he answers the novice investors' most frequently asked question, "how the market sets stock prices?" When Mishkin answers this question, he heavily focuses on the dividend side of the valuation and he has fails to mention that the future earnings of a firm have an even greater impact on stock prices. Despite the highly academic nature of his writing, those who are interested in learning more about the background of the financial crisis and financial markets should read this book.
Bernasek, Anna. "When Does A Housing Slump Become A Bust?" The New York Times 17 June 2007: 6.
Bernasek, in her article, "When Does A Housing Slump Become A Bust?" discusses the definition of housing market bust. While we have the exact definition of a stock market crash and a recession, economists have not agreed on what constitutes a housing market bust. Bernasek claims that because the only national housing bust happened during the Great Depression and the market statistics are not clear-cut, economists have avoided this topic. I found her presentation of arguments between two economists about the definition of the housing bust very weak since she failed to convince readers by not interviewing more economists. Bernasek, however made a strong point that measured prices may not reflect the actual sales price and they underestimate the declines. Lastly, she argues that we may be able to agree on the definition of the bust during this downturn "as people would feel the pain." What kind of pain is she talking about? Her unclear conclusion draws a clear distinction between an academic journal and a mass media article. Bernasek's article will benefit those who study economics and those who are interested in the real estate market since she explains the challenge of identifying a clear definition of the bust and its ambiguity. Her article will assist me in supporting my argument that the fate of the real estate market is still unknown.
Roubini, Nouriel. "The Worst Is Yet To Come." Foreign Policy (2008): 63-68.
Nouriel Roubini, in his article, "The Worst Is Yet To Come," published in March 2008 (Foreign Policy), forecasts the negative economic outlook not only in the United States, but in the global economy. Despite the fact that asset bubbles burst throughout the world, he predicted that more bursts would happen in the near future. His arguments seem very convincing since he claims that the credit crunch will continue because of deleveraging by hedge funds and other institutional investors. Since the publication of the article, his claims have come true: the global financial markets have seen the worst deleveraging in human history. Roubini also predicted that commodities and credit-default swaps in particular would create further market bursts. Again, his infamous forecast shocked the world; the price of oil fell sharply and the bankruptcy of Lehman Brothers brought huge losses on credit-default swaps. Lastly, Roubini argues that the only way to avoid further economic downturn is agressive actions by policy makers. Although his predictions turned out to be accurate, he did not make any effort to use sources that would have made his statement more convincing. Today, however because Roubini is considered the only economist who predicted the subprime crisis, he does not need to cite others' work even though other scholars and journalists cite his work all the time. Roubini's article would benefit almost everyone in the world since his analysis can help us to plan our financial future.
Belke, Ansgar and Marcel Wiedmann. "Boom or Bubble in the US Real Estate Market?" Intereconomics (2005): 273-284.
Ansgar Belke and Marcel Wiedmann, in their article, "Boom or Bubble in the US Real Estate Market?" published in September 2005 (Intereconomics), question whether the United States real estate market boom that lasted until summer of 2006 was driven by expansion in the economy or just speculations. Belke and Wiedmann try to convince readers by presenting a wide array of sources including scholarly journals, web sites,official government data, and financial magazines such as The Economist. Also, graphs and tables showcasing house data add greater credibility to their article. Belke and Wiedmann express how they worried that a rapid increase in available credit to borrowers would cause significant problems should the economy begin to contract. Their worries came true and it is very interesting how we are paying the price for not following their recommendations. For example, Belke and Wiedmann criticize the US government for implementing monetary policy to control the housing market. They argue that instead of monetary policy, fiscal policy should be implemented. It is no surprise that the government is now placing a great emphasis on fiscal policy. Belke and Wiedmann introduce new terms such as a strategy of "leaning against the wind" and "negative feedback trading." They, however do not explain what "negative feedback trading" is and expect the readers to know what that is. Also, their usage of vocabulary is somewhat complex, using many technical terms such as "positive deviations." Despite some negative aspects of their article, policy makers and those who are interested in the current economic issues should read the article since it would help them to understand the underlying causes of housing boom and bust.
Kimble-Ellis, Sonya. "Real Estate Blues." Network Journal (2008): 28.
Sonya Kimble-Ellis, in her article, "Real Estate Blues" published in November 2008 (Network Journal), discusses the changing environment in the real estate market. Kimble-Ellis claims that real estate agents are having a hard time getting mortgages for their clients since banks have changed their lending requirements. Kimble-Ellis interviews a real estate broker who argues that the new lending requirements put a higher barrier to inner-city home buyers. When one begins to read this article, one should notice that Kimble-Ellis starts the article by mentioning African-American real estate agents when she could have just said real estate agents. She purposely emphasizes "African-American" to let readers know that this article will discuss the real estate market in minority's views. Kimble-Ellis explains the term, "short sale" in simple language so that readers who have not received any financial education could understand. She mentions that the No Income Verification Loan is available to certain borrowers; however, that loan type had completely disappeared right after the financial crisis started.It must be true that Kimble-Ellis has no knowledge in the real estate industry. Since she does not verify the information she has obtained, her article loses credibility.Kimble-Ellis, however makes an attempt to represent the views of the minority when other journalists only write about the mainstream. Thus,those who study about the current economic condition of the minority may find this article interesting. In addition, this article could be beneficial in sociology and economics researches since the article presents the issue of social problems and financial regulations.
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