Now that we know what the monkey's credit card of choice is, I thought it would be interesting to see whythe Sapphire Reserve in the first place. The fact that the card is losing Chase money is clear, however Chase CEO Jamie Dimon spoke about this loss in a strange way:
"The card was so successful it cost us $200 million, but we expect that to have a good return on it," he said in the interview. "I wish it was a $400 million loss."
What is this good return the CEO is talking about, and why is he so happy about losing so much money? Is this a win-win, where Chase will be able to rake in more vendor fees with more users, and thus offer better deals to cardholders? Or are there ulterior motives? Let's take a closer look. According to the article:
Comparing pre-Reserve spending in July 2016 by existing Chase customers with post-Reserve spending in December 2016 ... spending increased more than 50%.
So customers who switched to the Reserve increased their spending by over 50%. It seems to me that the "savings" of the card are being outweighed by the increased consumption.
What are your thoughts on this, and the problem of spending more to save more?