Old Apr 4, 19, 6:24 pm
  #56  
javabytes
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Join Date: Apr 2009
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Originally Posted by MarkOK View Post
Interesting revival of a 2 year three month old thread......

Anyways, in the OP, writetorich valued AA miles at 0.8-1.0 cents apiece. That is exactly what I would value them at today. A couple of weeks ago I just booked SAAVER awards for a domestic Y trip and even with the SAAver pricing, my valuation 0.96 cents per mile. I feel like it was a win though since it has an actually decent travel schedule (no weird overnight stop, funky routing, crazy early flights, or all day layovers) which seems impossible to find sometimes. Last year, my 1 redemption was 0.84 cents a mile (also SAAVer awards) and came originally with a three layover trip, partly on Alaskan (which flight rescheduling thankfully made impossible and I was able to change to a more direct flight).

Real question to writetorich -- Are you still bullish on the value of a AAdvantage mile?
I have been bearish on the value of miles for years now. Admittedly I came from Delta, who arguably perfected the art and science of the “enhancement” (read: devaluation).

Credit cards are printing miles left and right. More demand for award seats means fewer seats available, unless the fare (in miles) goes up to compensate. Airlines then tell us we “asked” for such increases when we complained about poor award availability.

Eventually, I suspect all the US airlines will end up in fare-based redemption. Delta is most of the way there already with its dynamic award pricing. The beauty to such programs, in the eyes of the airlines, is that the reward value is predictable and consistent. That’s also why it should be boring to rational consumers - it’s effectively a rebate. In a world where miles are pegged at $0.01/ea., almost everyone would be better off putting spend on cash back cards. In theory, this should kill the appeal of most mile-earning credit cards, but people are not rational.

Sweet spots have existed for years and continue to exist, but earn-and-burn continues to be the prudent strategy for anyone concerned with maximizing the value of their miles.
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