Almost Perfect


Last Saturday I teased readers with the post titled “Found! The perfect perpetual point machine.”  I followed up that post with “One card to rule them all” in which I showed how to use American Express prepaid cards to earn nearly 5 points per dollar everywhere. 

I detailed the idea behind Perpetual Point Machines in the post “The Perfect Perpetual Point Machine, Part 1.”  There, I defined a Perpetual Point Machine (PPM) as a scheme in which, after a little push, points and/or miles are accrued over and over again, forever, with little or no additional work.  I also laid out a few rules of what makes a perfect PPM:

    1. It may take effort and money to setup initially, but must not take much effort or money to keep it going.
    2. It must be able to generate hundreds of thousands of points per year.
    3. It must do no harm.
    4. Ideally (but optionally) it would also do some good for the world.

The idea of a scheme like this going forever is obviously ridiculous, but it would be great to find one that lasts a few years at least.  The Amex prepaid card meets the basic requirements of a PPM.  It takes a little work to order and register your card.  After that, it takes just a little effort to fill it up regularly.  The points are earned, indirectly, through regular everyday spend. 

How long will it last?

If you read the comments of my previous posts on this subject, you’ll see a healthy debate about this.  Some argue with conviction that this deal will be dead within hours.  Others argue that it can last quite a while.  The truth is, we simply don’t know.  Earning points through credit card sign-up bonuses is currently the best PPM that exists, and while it has changed drastically over the years, it still lives on.  In this case, the deal can be shut down instantly if Office Depot stops allowing credit card purchases of reload packs.  Or, it can be shut down later by Chase if they change the bonus rules for the Ink Bold.  Feel free to make your predictions in the comments below (but please keep the debate civil!).

Judging Perfection

Let’s see how this PPM stacks up against the rules I laid out for “perfection”:

Not much effort: For people who live or work near an Office Depot that carries reload cards, this condition is met.  Simply walk in once a week, or once a month, and buy a few cards.  No problem.

Hundreds of thousands of points: Since the Amex Prepaid card is limited to $2500 per month, this PPM is capable of generating 150,000 points per year (2500 X 5 X 12).  Does that count as “hundreds of thousands”?  Close enough in my book.

It must do no harm: Uh, well…  OK, that’s where this falls down a bit.  Chase loses money on 5X transactions.  Just like big credit card sign-up bonuses, they do this in order to attract and keep customers.  So, if we abuse this perk, then yes you can argue we are harming Chase.  American Express does very well with this scheme unless people abuse the ATM option.  However, anyone who does that will get shut down by Amex, so Amex is fine.  As to Office Depot, I truly don’t know.  I’ve been told by an industry expert that they do make money with the sale of these reload packs.  So, until I learn otherwise, I’ll assume Office Depot earns a profit from these sales.

Do good in the world:  That really depends on how you use your prepaid card.  If you use it to make charitable contributions (and add a little bit to cover the charity’s credit card transaction fee), or you use it to make Kiva loans, then we’re doing good!  OK, that’s a stretch.  This was an optional requirement anyway.

Overall, I’d say this is a really good, but not perfect PPM.  What do you think?

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