Thursday, October 16, 2008

The Rewards of Charging $770B

Assuming that Paulson’s had to pull out the plastic instead of charging this financial rescue plan to taxpayers, what does $770 billion get you in rewards? Assuming Paulson has excellent credit, no annual fee, but wants some perks for giving them his business; here are some offers he could take:

Blue Cash AMEX
He has a whole year to party interest free before having to pony up (or to resign), but let’s say he wants some cold, hard, cash rewards. Since this is not an “everyday purchase” i.e. gas, supermarket, or the like, he will only get 1.5% cash back on his purchase. That is $11.55 billion in chump change to play around with. However, that reward is given as a credit on the AMEX bill; therefore Paulson owes only $758,450,000,000. At that point even if he paid $10 billion a month it would still take him over 10 years to pay it off.

Miles by Discover Card
Let’s say Paulson could care less about getting cash back. He doesn’t need a discount, heck- he needs a vacation after all this stress!

With this card he could get 1 mile for every dollar spent, and every 5,000 miles gets a $50 travel credit towards his travel purchases. Using Airtreks I made an amazing around the world trip (New York - San Francisco - Honolulu - Papeete (Tahiti) - Sydney - Bali (Denpasar) - Jakarta - Singapore - Bangkok - Hong Kong - Taipei - Hong Kong - Shanghai - Tokyo - Seoul - Beijing - Delhi - Bombay / Mumbai - Nairobi - Johannesburg - Cairo - Athens - Rome - Barcelona - Madrid - Paris - Budapest - Vienna - Frankfurt - London - Amsterdam - Paris - London - Reykjavik - New York - Montreal - Miami - Mexico City - San Jose - Caracas - Quito - Lima - Santiago - Buenos Aires - Sao Paulo - Rio de Janeiro - Lima - Los Angeles - Vancouver - Seattle - Chicago - New York) that costs about $17,542. Paulson and 438,946 of his closest friends could take this trip for free!

Or, if this isn’t exciting enough, he could mimic American space tourist Richard Garriott and dock with the International Space Station. For a cool $20 million he could only bring 384 friends along with his rewards bucks. However, he will have to start paying back the whole $770 billion after only six months and it would take him over 11 years to do so.

However, this is all assuming that $770 billion isn’t over his credit limit, if it is, he goes into the default rate- a whooping 30.99%. If he paid $20 billion a month it would take him almost 17 years to pay off.

Chase Free Cash Rewards Visa Card
Let’s say that Paulson’s a shopper. He could get 1 point for every eligible dollar purchase. If we assume these are eligible dollars, with this card he could get a $25 gift card to a leading national merchant for every $2,500 he spent. This sound like it could be enough gift cards to stuff every Christmas stocking in the US, but hold on there’s a catch! There’s a maximum point accumulation on net purchases which is 60,000 points per calendar year. That means he could only get $600 worth of gift cards per year.

So sad, but just what could he get? Why it’s a Compaq Presario CQ50-210US 15.4" Widescreen Notebook Computer With AMD Athlon™ X2 QL-62 Dual-Core Processor from Office Depot!

While the introductory offer period is a year, when it wears off Paulson will be hit with the standard 19.99% rate. Paying $13 billion a month it will take him over 21 years to make the balance hit $0.

While Paulson can’t really charge this debt, and the rewards of this financial rescue plan are different than those stated above; I have to wonder- will we as a nation have this debt paid off in 10, 11, 17, or 20 years?

No comments: